Understanding ASIC’s Strategic Enforcement Priorities for FY25

As noted recently in Money Management, The Australian Securities and Investments Commission (ASIC) recently unveiled its strategic enforcement priorities for the 2025 financial year, signalling a firm stance on key areas that are critical to the financial advisory industry.

Because of these priorities, it is more important now than ever to have a paraplanner partner with expertise that you can trust.

The Role of Paraplanning in the Financial Advice Process

Paraplanners are the unsung heroes of the financial advice process. They support financial advisers in preparing reports and ensuring that the advice provided complies with regulatory standards. Their work is not only pivotal to the efficiency of financial advisory firms but also to the accuracy and compliance of the advice delivered to clients.

It’s important that you work with your paraplanning partner in addressing ASIC’s concerns this year.

ASIC’s Strategic Enforcement Priorities for FY25

ASIC’s FY25 strategic enforcement priorities focus on several key areas that directly impact the financial planning industry. These priorities include:]

• Protecting Consumers and Investors: ASIC is prioritising the protection of vulnerable consumers, ensuring that financial advice is not only suitable but also in the best interest of the client. This is a continuation of ASIC’s commitment to upholding the standards set by the Best Interests Duty and related obligations under the Corporations Act 2001.
• Addressing Misconduct in Financial Services: ASIC will continue to focus on identifying and addressing misconduct within the financial services sector. This includes actions against firms or individuals who engage in misleading or deceptive conduct, fail to act in the best interest of their clients, or breach their duties.
• Ensuring Market Integrity: Maintaining fair and efficient markets is another critical priority. ASIC aims to deter and penalise market misconduct, including insider trading and market manipulation.
• Digital Finance: With the rise of digital financial products and services, ASIC is emphasising the need for oversight and regulation in this space. This includes ensuring that new technologies, such as robo-advice and digital investment platforms, are compliant with existing laws and do not expose consumers to undue risks.
• Sustainability and Climate-Related Disclosures: As environmental, social, and governance (ESG) factors become increasingly important in financial decision-making, ASIC is focusing on the accuracy and transparency of sustainability-related disclosures. This ensures that investors are not misled about the sustainability credentials of their investments.

How A Good Paraplanner Will Help

Understanding ASIC’s enforcement priorities is critical for paraplanners for several reasons:

• Compliance and Risk Management: Paraplanners are at the frontline of ensuring that the financial advice process is compliant with regulatory standards. By being aware of ASIC’s priorities, paraplanners can identify potential compliance issues early and ensure that the advice prepared aligns with the latest regulatory expectations. This reduces the risk of enforcement action against the financial planning firm and protects the firm’s reputation.
• Quality of Advice: ASIC’s focus on protecting consumers and ensuring that advice is in their best interests underscores the importance of high-quality advice. Paraplanners contribute significantly to the quality of advice by preparing detailed, compliant advice documents. Staying informed about ASIC’s priorities ensures that paraplanners are contributing to advice that meets the highest standards.
• Sustainability and ESG Considerations: As ESG factors become more prominent, paraplanners need to be aware of the regulatory requirements surrounding sustainability-related disclosures. This knowledge is crucial for preparing advice that accurately reflects the ESG credentials of investments and for advising clients who are increasingly focused on sustainable investment strategies.

The Implications of Non-Compliance

Failing to adhere to ASIC’s enforcement priorities can have serious consequences. Non-compliance can lead to penalties, legal action, and damage to a firm’s reputation. This is why it is so important that you’re able to work with your paraplanning partner to remain compliant.

Moreover, in an industry where trust is paramount, any breach of regulatory standards can erode client confidence and have long-lasting effects on the client-adviser relationship. By staying informed about ASIC’s priorities, paraplanners can help mitigate these risks and contribute to the overall success of their firm.