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ASIC voices concerns over broker commission model

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Miklos Bolza | 17 Mar 2017, 08:25 AM Agree 0
The six proposals suggested in ASIC’s remuneration review affect broker commissions, soft incentives, disclosure and more
  • unfair | 17 Mar 2017, 01:27 PM Agree 0
    It's quite interesting when you look deeper, this started from the financial system inquiry, which the government responded to by instructing ASIC to do the review. If you look at who is on the panel of the financial systems inquiry... there are 3 big shots on there that were previously bank directors etc... ie, CBA, westpac, AMP etc.
  • A Disillusioned Broker | 19 Mar 2017, 10:40 PM Agree 0
    I cannot find one thing in this report that would result in an improved outcome for my clients or my business.

    This is hardly an impartial report, it is a seriously biased stitch-up ( ordered by ex-NAB executive Kelly O ‘Dwyer in cahoots with the three ex CBA, Westpac and AMP bank executives that are on the Financial System Enquiry panel ) that the ABA may as well have written on behalf of ASIC, as all is does is shoot down the unbroken pay for performance, long established commission model at every opportunity – it has nothing whatsoever to do with Brokers clients satisfaction levels or the current outcomes that Brokers achieve for their loyal clients.

    Many of these orchestrated “findings” contained in this report defy logic, basic common sense and are based on unsubstantiated and paranoid what if’s – that may or could occur in the future and assumes that all Brokers are just self-serving commission hungry rogues that ignore the current laws ,compliance regime and that we don’t put our loyal clients first.

    Point #1 – Improving the standard commission model for Broker – what they mean is “improving” the standard commission model for lenders , resulting in less income for Brokers.

    The rest of this report is largely irrelevant dribble won’t make much, if any, difference to consumers - what it will do is increase my stationary costs and waste more of my time. I won’t miss the holidays to L.A , Hawaii or the Caribbean, or the soft dollar commissions as I have never been a part of any of these perks. My Aggregator actually charges us to attend their annual conference.

    Like most self-employed people we get paid on performance, and volumes written has always been a measure of that success as it should be, LVR and loan complexity is irrelevant from a payment perspective and if these peanuts at ASIC really believe that Brokers write larger loans so that a Broker can be paid more is, then God help us all , as we all know that this is pure fantasy as clients have the ability to think for themselves ,set their own budgets when making purchasing decisions , and they are the party that ultimately decides the preferred loan amount , not us.

    Loans sizes are just a matter of fact statistic, however I will give ASIC an insightful tip though – larger loans are usually linked to people with above average incomes who purchase above average priced properties, an amazing revelation ha ! – and these clients probably use Brokers as they can’t be bothered wasting their precious time getting biased product advice along with the substandard and disjointed service on offer at the banks.

    I have a strong suspicion that countless professions earn more on bigger jobs than smaller jobs – should all their incomes be interfered and tampered with by ASIC too?

    This ASIC report is an extremely biased and inaccurate assessment of our industry that is basically written with the end in mind, all designed from the outset to satisfy the bank driven agenda of driving down commissions. It is obvious why the bureaucrats that prepare these fictional reports are not small business operators!

    It is likely that any reductions in commissions will result in and industry wide fee for service levy to make up any shortfall, perhaps ASIC can also advise how this will result in better consumer outcomes.

    I look forward to the formal response to ASIC from the FBAA ( less so from the bank sponsored MFAA) not that ASIC will be paying too much attention to whatever feedback they receive ,as it appears the outcome of reducing Brokers income has already been decided , just as the banks have ordered.

    As a veteran of this industry I would not recommended that anyone consider joining it.


  • Kate | 23 Mar 2017, 11:46 PM Agree 0
    I don't think you are right .... for a million. Dollar loan you as broker get 6 000.00 in commission and another 150.00 a month per life.
    You tell me this ... these are from people whom most of the r just in it for the money and due to this create so much doggy transaction due to the incredibly high pay .
    I bet you if asic runs a whole vic check , both the broker anthe banks are in trouble .
  • Kate | 23 Mar 2017, 11:49 PM Agree 0

    Yes those three banks are just as bad to their staff as the next ... where's the investigate into treatment of staff and employment ...I don't think you are right ....
    You tell me this ... these are from people whom most of the r just in it for the money and due to this create so much doggy transaction due to the incredibly high pay .
    I bet you if asic runs a whole vic check , both the broker anthe banks are in trouble .
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