Quebec independent advisors lead charge against CRM2

Quebec independent advisors lead charge against CRM2

Quebec independent advisors lead charge against CRM2 By Kate Kingsbury

New financial regulations are rarely introduced without some customary eye-rolling by industry associations. However, the reaction of Quebec’s leading association of independent advisors might be setting a new standard for industry backlash.

The Professional Association of Financial Services Advisors (PAFSA) says it will continue to fight the full implementation of CRM2.

Spokesman Flavio Vani: "I am disgusted with the new regulations, we were never consulted, the regulators crushed us like a steamroller. We are currently investigating how to stop CRM2. We want politicians and regulators to join us at a round table to discuss the impact on advisors and on customers."

The Quebec argument is similar to that from embedded commission advisors across the country, with PAFSA suggesting CRM2 will jeopardize the activities of independent financial advisors.

"Look at what happened in Australia and England,” Vani told gestionnairedefortune.ca, the French-language sister publication of WP. About “25-30% of advisors were forced out of business, plus prices to obtain financial advice increased, hence less well-to-do customers suffered."


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4 Comments
  • Tim Affolter 2015-03-26 2:25:31 PM
    I'm afraid PAFSA is right. The regulations are going to create anything BUT a level playing field. Consumers are going to be totally confused when they see the same investment names being sold at a bank or insurance company for "free" because only advisor comp is being disclosed, not the sum total dollar amount of the fees, both direcct and indirect (is: bond spreads,) clients are paying to both the dealer AND the manufacturing institution. In its present form, CRM2 will create a dog's breakfast of disclosure facts, ranging from fully disclosed and negotiated fees on institutional-style pools to apparently free options delivered by your friendly neighborhood bank. There will be no comparing the results. Our hope for true change in the industry is being exchanged for a witch hunt in which advisors are being singled out.
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  • Ken kivenko 2015-03-26 4:12:42 PM
    Crm2 is about fee disclosure and performance reporting. Only way it is bad for Reps is if fees too high or performance too low. Investors have every right to know the cost of advice and its benefit. Those who oppose this should leave the industry.
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  • larry elford 2015-04-08 8:07:17 PM
    I agree with Ken Kivenko, one of the better informed investment experts in Canada. However if the Professional Association of Financial Services Advisors (PAFSA) would remove the words "professional" and "advisors" from their name, they could probably be at least somewhat safe in terms of disclosure, or at very least protection from misrepresentation accusations.
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