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In February 2019, the Federal Government made headline recommendations as result of the Royal Commission into the banking, superannuation and financial services industry.  The recommendations suggest new ways to deliver financial advice, including:

  • changes to ongoing fees
  • disclosure of lack in independence
  • quality of advice
  • conflicted remuneration and discipline for misconduct.

The report also suggests that criminal charges be considered, including the possibility of prosecutions among the major banks.  The final report made 76 recommendations and 24 referrals for potentially criminal conduct.

The recommendations within the report were formulated on six underlying principles:

  • obey the law,
  • do not mislead or deceive,
  • act fairly,
  • provide services that are fit for purpose,
  • deliver services with reasonable care and skill, and
  • when acting for another, act in the best interests of that other.


Financial Advice

  • All ongoing fee arrangements must be reviewed annually by the client
  • Financial advisers who lack independence must, before providing personal advice to retail clients, disclose this to the client in writing
  • Grandfathering commissions for conflicted remuneration should be repealed as soon as reasonably practicable
  • ASIC should consider further reducing the cap on commissions in respect of life risk insurance products
  • All remaining conflicted remuneration exemptions should be reviewed, and consideration given to whether they remain justified
  • All financial advisers who provide personal advice to retail clients should be subject to a new, single disciplinary body, with all advisers required to be registered.


  • Trustees of a superannuation fund must not assume any obligations other than those related to performance of their duties,
  • Deduction of advice fees from MySuper accounts (other than for intra-fund advice) should be banned,
  • Advice fees for non-MySuper accounts (other than for intra-fund advice) should be prohibited unless certain requirements are met,
  • Hawking of superannuation products should be abolished,
  • Employees should only have one single default superannuation fund, and
  • Over time extend the Banking Executive Accountability Regime to all RSE licensees.


  • The hawking of insurance products should be prohibited,
  • The exclusion for the sale of funeral expenses policies should be removed,
  • ASIC should impose a cap on the amount of commission that can be paid to car dealers for the sale of add-on insurance products,
  • The unfair contract terms provisions in the ASIC Act should apply to insurance contracts, and
  • The claims handling exemption should be removed.

Other recommendations address culture, governance and remuneration of regulators and simplification of the laws.  The recommendation are now subject to the government successfully bringing forward legislation changes to enable adoption of these important recommendations.