An illuminating article in the Australian Financial Review (23/7/11) talks about how the big banks etc. (and the financial planners aligned to them) “funnel most of their client’s money into their own products”. The article points out that:

  • according to Roy Morgan Research, AMP aligned planners are directing more than 80% of their clients’ superannuation money into AMP’s own super funds,
  • the article talks about a similar “home bias” in regard to the Commonwealth Bank of 77%.

Further, an article from the Financial Standard (Oct. 2010) has AXA advisers “channelling 75 per cent of their business into AXA superannuation strategies. CBA/Colonial First State came in third….at 74%”. 

To be a financial planner in Australia requires a person to be “licensed”. This requires a certain level of education and to be an Authorised Representative of an Australian Financial Services License (AFSL).

Now there are 2 main ways a financial planner can work under a AFSL:

  1. get your own,
  2. work under a license held by another organisation – oftentimes one owned by one of the big banks. Big banks (and AMP) own companies called “dealer groups” who in turn hold the AFSL. Many financial planners work under these AFSL’s. They are:
  • Garvan Financial Planning, GWM Adviser Services, Godfrey Pembroke Financial Planning, MLC Financial Planning and Apogee FP. NAB also hold an equity stake in Meritum Financial Planning. All owned by NAB (which also owns MLC).
  • RI Advice Group (RetireInvest) and ANZ Financial Planning. All owned by ANZ (which also owns OnePath).
  • Financial Wisdom and Commonwealth Financial Planning. All owned by Commonwealth Bank (which also owns Colonial).
  • Securitor, Magnitude Financial Planning, Westpac Financial Planning, St George Financial Planning. All owned by Westpac (which also owns BT Financial Group).
  • Hillross Financial Services, AMP Financial Planning, AXA Financial Services, Charter Financial Planning, Genesys Wealth Advisers and IPAC Securities. All owned by AMP

(note: the above is not a complete list)

To quote from the article, “According to the Roy Morgan survey, 42 per cent of RI Advice clients said they believed their financial planner was independent of any financial institution. RI Advice, like Hillross, is the “external” financial planning arm of a financial institution. The external financial-planning arms, called “dealer groups”, provide the license under which small financial planning businesses operate. Each practice is acting somewhat like an agent of the license-holding dealer group and the institution that owns the dealer group”.

Harvest, are different. We operate under our own AFSL. Harvest is owned solely by the Principals of the business and we are able to recommend a wide range of product solutions for our clients; untainted by any conflicts (perceived or otherwise) between the product we might recommend and the ultimate provider of that product.

We believe that our advice and product recommendations are made truly with the best interests of our clients solely in mind.