Reform to the financial sector needed to protect investors
Posted on Thursday, 10 September 2009
The Hon Judi Moylan MP has called for reform to the financial sector to better protect the public in their dealings with banks, investment companies and financial advisers.
Speaking on the Corporations Legislation Amendment (financial Services Modernisation) Bill 2009, Mrs Moylan cited examples from her own electorate of Pearce to highlight the often deep conflicts of interest that can exist between the general public and those entrusted with managing their finances.
“It is very apparent to me, from discussions with constituents, that, quite often, they believe their financial advisers did not fully understand what the implications of some of the products they were selling were,” Mrs Moylan said.
A number of products, from superannuation to margin loans, can create problems and Mrs Moylan said constituents often encountered trouble with reverse mortgages.
“Reverse mortgages can be fantastic products for some people, if they fully understand what the package is about,” Mrs Moylan said.
“Nevertheless, some people, young and old, still do not fully understand the implications of this product. Some reverse mortgages would probably even perplex a Rhodes Scholar.
“There is not a need for targeted reform to the financial system, and issues that have been the subject of considerable media attention have made it very clear that there are issues about the linkages between advisers and lenders, and their individual responsibility to the borrowers or the users of these products.