The broker associations have pushed back against claims raised over broker conduct in the property investment space.
This week, PICA issued a letter to industry associations – including the broker associations – warning of speculative marketing, unlicensed financial advice, and conflicted remuneration involving some market participants, including mortgage brokers.
In the letter, PICA urged professional bodies to remind members of their obligations under consumer law and ASIC guidance.
While the broking associations have acknowledged receipt of the letter and the importance of ensuring that advisers are legally compliant, they have lamented that more specific detail and engagement were not forthcoming.
Speaking to The Adviser, the Mortgage & Finance Association of Australia (MFAA) stressed that mortgage brokers operate within a highly regulated framework.
“The mortgage broking industry is highly regulated, with mortgage brokers operating under the Best Interests Duty, a licensing regime and ASIC oversight, in addition to strong education and compliance frameworks,” CEO Anja Pannek said.
“It’s disappointing that what appear to be unsubstantiated concerns have been raised without prior engagement or any specific detail being provided to the MFAA, the peak body for the industry from PICA.
“Data, including a low volume of AFCA complaints, supports the rigorous adherence of brokers to their regulatory obligations.”
Pannek encouraged PICA to engage directly with the association if concerns arise and for consumers to report complaints through the appropriate channels.
“We encourage PICA to be constructive when engaging with industry bodies and raising specific concerns they may have,” she said.
“Importantly, we encourage any consumer who has concerns or believes they have suffered a loss to raise the matter directly with the MFAA or with the Australian Financial Complaints Authority (AFCA), so that issues can be properly investigated and addressed.”
Similarly, Peter White AM, managing director of the Finance Brokers Association of Australia (FBAA), said: “This is very new correspondence and we’re working our way through it.
“We don’t condone any behaviour involving inappropriate unlicensed conduct and always strive to uphold the highest standards of integrity.
“We have no tolerance for those conducting activities in areas they’re not supposed to.”
