The Monetary Authority of Singapore has released a consultation paper on the recommendations of the Financial Advisory Industry Review, a body that was set up by MAS to review the financial advisory industry, with the aim of raising the standard of practice in the field.

The consultation paper seeks feedback on all the 28 recommendations made by the FAIR panel in January, as well as some additional suggestions from MAS. 

The original recommendations fell under five headings: Raising the Competence of Financial Advisory Representatives; Raising the Quality of Financial Advisory Firms; Making Financial Advising a Dedicated Service; Lowering Distribution Costs; and Promoting a Culture of Fair Dealing.

Principle

In a statement released this week, MAS said it has reviewed the report and “agrees in principle”, to the recommendations made by the FAIR panel.  MAS has also made further recommendations to facilitate the implementation of the FAIR panel’s proposal, including:

·         Providing details of how the Balanced Scorecard Framework for remunerating financial representatives will be operationalised across the industry;

·         Elaborating on the FAIR panel’s proposals to strengthen the complaints handling and resolution processes of financial advisory firms and incorporating the enhanced requirements in the Financial Advisers Act;

·         “Grandfathering” former financial advisory representatives who are on a “short career-break” from the  industry, should the proposal to raise the minimum academic entry requirement be adopted; and

·         Allowing financial advisory firms to enter into “introducer” agreements with corporations only.

The consultation paper is available on the MAS website and comments should reach MAS by 4 June 2013.