Financial advice firm calls on ASIC to 'outlaw' robo-advice

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The managing director of a financial advice firm has slammed the emerging concept of robo-advice, and has called on ASIC to ban the practice.

Wealth Today managing director Greg Pennells took aim at robo-advice, calling the concept "outrageous" and saying ASIC should disallow the practice.

“It amuses me that financial planners operating at major banks continue to get themselves into trouble and give our industry a bad name.Their response is to push the barrow for robo-advice and its one-size fits all approach to no-advice financial planning. It’s outrageous," Pennells said.

Pennells said the idea of a "one-size-fits-all DIY approach" to financial planning was opposed to the core concept of Wealth Today and its network of advisers.

“Every family and their circumstances are as unique as their thumbprints, so to suggest that a one-size fits all advice model will be beneficial to everyone and work to achieve each individual’s financial challenges and goals, is ridiculous,” he said.

Pennells said it would be impossible for everyday investors to undestand the myriad of financial instruments available in the marketplace.

“To leave them to their own devices when it comes to something as crucial as planning and securing their financial futures is ludicrous,” he said. “Conversation with an experienced planner is critical to providing clients with education. It expands their understanding, and in most cases their awareness, of a myriad of aspects of finance. Just by having a preliminary conversation, an experienced planner can cast light on needs that a client hadn’t even considered. By contrast, the robo-advice advocates are saying ‘Do it yourself, mate.’ That’s not service at all. It’s a complete cop-out.

“I hope ASIC do the right thing and outlaw this ridiculous new ‘innovation’ in financial planning. It threatens to undo all of the work they have done over the past decade to regulate and change the industry for the better,” Pennells said.