Association warns of rise in unqualified brokers

by Julia Corderoy30 Jun 2015
The FBAA has raised concerns about the number of people entering the industry who are not trained as mortgage and finance brokers.
 
According to the association, in July 2011, there were more than 20 thousand Australian credit licences (ACL) and Australian credit representatives (ACR) in the industry with 92% being brokers.
 
However, in four years, combined ACL and ACR figures have jumped to 39 thousand with only 56% noted as being broker-trained.
 
FBAA chief executive officer Peter White is concerned at the huge variation and big increase in non-brokers holding this status.
 
“The total market of these credit licence and representative holders has climbed a staggering 88% but the broker markets only risen 15 out of that 88%,” he said.
 
“It’s a worry because these additional entrants in the consumer lending arena are not brokers per se and pose a concern as to conflicts of interest and possible poor advice.”
 
White believes that many credit reps, such as accountants and financial planners, are cross-pollinating in to the broking market.
 
“Who holds these ACR holders accountable and responsible for their conduct, their ongoing education and to see that best practice is met?
 
“If accountants, financial planners or anyone else in the industry want to act as brokers, you have to undergo specific and designated training to suit the needs of customers.”
 
ASIC’s rules clearly state that credit representatives who provide mortgage broking services must have at least a certificate IV in financial services and undertake at least 20 hours of continuing professional development each year.
 

COMMENTS

  • by Sylvia 30/06/2015 9:20:00 AM

    Is Peter White suggesting that a degree qualified financially training accountant needs a lower grade qualification to be a broker?? Please when RAMS is proud of turning a florist into a broker. I know who I'd rather use. It's sour grapes that they may not be FBAA members. ASIC doesn't require FBAA or NTAA membership to determine a brokers competence. The so called unqualified brokers White refers to would be part of an aggregator and would be getting their 20 hours CPD as well as 20 hours of CPD as a professional. Is White suggesting ASIC is incompetently issuing licenses??

  • by Michael Kent 30/06/2015 12:28:55 PM

    I agree with Sylvia. Absolute sour grapes.

    I have been a member of both the MFAA and FBAA and brokers get absolutely NOTHING for their $400 a year membership.

    I see Peter White pop up at events now and then. He will bang on about how he is going in to bat for us poor mistreated brokers but it's just a way of justifying the yearly dues we have to pay.

    What exactly do they do? Do they improve my commissions? NO, make it any easier to get my clients approved? NO, provide any kind of worthwhile effective marketing material? NO, provide me with any free leads? NO.

    His fear is that in the future people won't need to belong to an FBAA or MFAA which quite frankly is just a cash cow milking brokers dry.

  • by Antbroker 30/06/2015 1:28:03 PM

    I agree with Peter White. To be part of the professional Broker Industry you need to be a Licensed Broker, that is the rule, like it or not! Clients deserve recourse for shoddy work whether delivered by an experienced broker or a newby, and that is what your License gives. Why should their be short-cuts as suggested by Sylvia and Michael just because you think you can be a jack of all financial trades.