Lawyers are “scare-mongering” to capitalise on intermediaries’ uncertainty about their ability to move painlessly into the new Financial Services Reform Act licensing regime, says Australian Securities and Investments Commission (ASIC) Director of FSR Licensing & Business Operations Pauline Vamos. “We fear that some lawyers and other groups are using the brokers’ lack of understanding to make money out of the situation,” she told Sunrise Exchange News.

She was speaking after yet another large turnout for the nationwide “ASIC Speaks – one year out, one year to go” seminars, in which the regulator has explained all that needs to be explained about the licensing process. The licensing deadline is March next year.

Ms Vamos says she hopes the information seminars help participants to get their licences as quickly and painlessly as possible. But the main issues raised included the “lack of faith and understanding” of the new licensing regime by some brokers, and the degree to which “some legal firms” are using scare tactics to capitalise on the situation.

John Hanks, a consultant for the National Insurance Brokers Association, says there’s definitely a need for licensing in Australia, but ASIC is still leaving some questions unanswered for brokers.

“Brokers are seeking advice from lawyers because they are looking for answers that ASIC are not providing them with, in many cases,” he said. “If the advice was adequate, brokers wouldn’t have to spend a fortune on outside advice.”

But Ms Vamos disagrees. “There’s no need for brokers to spend thousands of dollars seeking professional advice on how to obtain their licences.”