Remember that thing called the FASEA Code of Ethics?

This discussion about the practicalities of the Code of Ethics is exactly what’s needed. As pointed out, there still tends to be two camps – those who are embracing the Code and seeking industry evolution, and those who are trying to maintain the “old ways” and seeking work around.

Consider a recent post on LinkedIn, ““Right now I have a number of (Financial) Advisers … seeking a reciprocal referral arrangement with a proactive Mortgage Broker. It is important to note that under Best Interest Duty Code of Ethics Advisers are no longer able to receive Referral commissions. So these partnerships will mean you keep all your commission, but you reciprocate with Wealth Referrals.”

Can anyone articulate what might be wrong with this approach to the Code of Ethics? Are the referral arrangements for the benefit of the client or the commercial interests of the overall entity.

FASEA CEO hinted referral fees/arrangements may not be outlawed completely from an ethics standpoint, but warned justification for the referral needed to be established.

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