: Sonny Goldstein - Submission

Submission to the Expert Committee on Financial Planning Public Consultation by Sonny Goldstein, CFP – June 2nd, 2016

First let me commend the committee for recognizing that reforms to the existing regulatory environment for financial planning and financial advisory services are warranted; that there is a lack of oversight for providers of financial planning who do not sell financial products; that there exists today varying degrees of proficiency and no consistent accreditation; that there are too many titles and designations in our industry; there is an asymmetry in financial knowledge between providers and consumers; that in most instances, there is an absence of an explicit obligation for providers of financial planning or financial product sales and advice to act in their client’s best interest, although many financial advisors who are members of existing professional associations are sworn to that obligation.

Regulation should be required of any individual or firm that provides financial planning services but who should be responsible for providing that regulation? Not a mish mash of various existing regulators for those who have such regulators and a new and separate body for those who don’t.

The Province currently has jurisdiction over licensing/registration of people selling financial products and the licensing of financial planners should be the same and there should be one set of standards. Education and training should be left to the commercial suppliers so long as their course content, materials and testing standards are approved by the Province and/or CSA.

Your Paper does not define “statutory best interest duty”. I think you need to use a ‘best practices’ best interest duty that would be more appropriate, easier to define clearly and could be cribbed from existing definitions in use by Advocis or FPSC.

There should be:

  1. a list of approved titles that are descriptive of the regulated activities;
  2. and that those be the only titles permitted
  3. and that you have to be an accredited financial planner (as described previously) to use the title
  4. and that you can only use professional/academic titles approved by regulators;

Consumers deserve to have a true, recognized professional financial advisor dealing with their most precious resource – their money.

Financial advisors do not currently have a voice within the regulatory structure that oversees them and have no input into their own oversight – this is a situation of regulation without representation

All financial advisors, regardless of sector, need to belong to one professional body. Governed by a subset of elected advisors and members of the public, this designated administrative authority (DAA) would be responsible for the oversight and development of regulation. Under this structure all financial advisors would be required to adhere to a code of professional and ethical conduct, mandatory professional liability (errors and omissions) insurance, ongoing continuing education, a published best practices manual and a disciplinary process with authority to suspend an advisor who has wronged a consumer.

Use your authority to create our own Financial Planners’ Professional Association just like the medical, legal, accounting even hairdressing professions, with the authority to regulate our members and punish those who do not comply with the highest ethical standards regarding consumers. Let advisors and members of the public oversee such an association that reports to a government body and finally treat the almost 80,000 good apples with the respect we deserve.