Nearly half of Albertans (46%) believe that the title “financial advisor” is regulated and requires some form of accreditation, according to survey results published Saturday by The Financial Advisors Association of Canada (a.k.a. Advocis). This, however, is not the case.
These worrisome results echo those of a similar survey conducted in Ontario last month. Advocis says the lack of awareness around loose regulations poses a threat to consumers.
“For years, we’ve recognized the dangers that lack of title protection presents for the financial well-being of hard-working families seeking professional financial advice,” Greg Pollock, Advocis CEO and president, says in a statement. “This survey proves there is a tremendous amount of misplaced trust in the market, and reinforces just how badly new regulations are needed to protect the public.”
The Advocis survey found that Albertans support title protection, with 89% of respondents saying they would support the provincial government in passing a law that would regulate the use of “financial advisor,” and 85% would support the implementation of a mandatory code of conduct for advisors.
“All Albertans deserve to know their money is in the hands of true professionals, who are qualified to help them meet their financial goals,” Pollock says. “The time has come to legally recognize the provision of financial advice as a profession and to oversee financial advisors as we do all other professionals who provide essential advice and services.”
Because of a lack of regulation, Advocis says, there is no central database where investors can confirm that their advisor is credible and consult their disciplinary record, and there are also no consistent, mandatory continuing education (CE) requirements across the industry.
Advocis is calling on the Alberta government to require that all financial advisors become members of a professional governing organization and adhere to a common code of ethical conduct. Advocis also says that it should be mandatory for advisors to maintain professional liability insurance, stay current with CE and “commit to a fair and impartial disciplinary process.”