The Association of Financial Advisers (AFA) is concerned about calls for the introduction of a fee for service structure, saying it could do more harm than good for consumers by limiting their choices and access to financial advice.

Last week the Institute of Chartered Accountants called on financial planners to move to a fee-for-service model, saying that commission payments result in conflicts of interest.

The institute’s Manager of Financial Planning and Superannuation, Hugh Elvy, says the recent Westpoint collapse is an example of how the conflict of interest between the needs of the client and the “self-interest of the adviser” can impact on the financial planning process.

But the AFA says it supports recent comments made by Australian Securities and Investments Commission Chairman Jeffrey Lucy that the current regulatory environment encompassed by the Financial Services Reform Act is a “strong, fair and progressive approach”.

CEO Richard Klipin says that in addition to a strong regulatory environment, the association has a strict code of ethics guiding advisers’ practices.

“Our code of ethics focuses on honesty and the best interests of the client. It also requires advisers to abide by the regulations,” he said. “We welcome the diligent process of the regulator to identify dishonest practices and to use the legislation to deal with the perpetrators for the protection of consumers.”