A major bank chief has come under fire after he suggested brokers could be the next in line to face increased scrutiny by regulators in a crackdown on responsible advice in the financial services industry.
In a panel discussion at Aussie
Home Loans’ 2015 sales conference, Westpac CEO Brian Hartzer suggested brokers could be next under the regulatory microscope, following a rigorous ASIC crackdown on financial planners. While Hartzer was overwhelmingly complimentary toward the broker channel during the panel discussion, industry figures have zeroed in on his comments regarding regulation to take aim at the major bank chief.
One such figure is FBAA
chief Peter White
. White rejected Hartzer’s comments, saying they are designed to deflect attention away from Westpac’s own poor performance by their financial planners.
“There is no basis for the need of increased scrutiny over and above what is already happening and has been happening for years. ASIC has a good handle on our sector and they are constantly monitoring, reviewing, investigating and reporting, plus taking action against those doing the wrong thing,” White said.
According to White, Hartzer believes regulators are now going to target the sales practices of brokers.
“These comments tell you exactly how out of touch Mr Hartzer is with Australian broking practices. Has he not heard about the National Consumer Credit Protection Act (NCCP) in which all brokers fall under and are constantly checked to see if responsible lending is occurring?”
The chief executive officer of Mortgage Choice
, John Flavell
, has also weighed in, saying Hartzer’s view is outdated.
“The reality is that the mortgage broking industry has gone through significant change over the years with the introduction of National Consumer Credit Protection legislation. All brokers have a very clear obligation to ensure that customers can service their debt without substantial hardship,” he said.
“Today, brokers are well educated mortgage professionals who are well placed to deliver customers with sound home loan advice, guidance and importantly choice.”