“[This] option would reduce the regulatory burden on TFAs and minimise the regulatory overlap to a large extent,” the regulator said.

“For example, the code of professional conduct in TASA would not apply to TFAs, just the code of ethics set by FASEA. Further, we would not set education requirements for TFAs as the TPB currently does; setting education standards would be the role of FASEA alone.”

ASIC said by giving it sole regulatory responsibility over financial advisers and TFAs, consumers would continue to be protected by the Corporations Act for any substandard advice given by either adviser type, and less confusion would exist among consumers over who to make a complaint to around adviser misconduct.

However, the regulator said it would not support the reinstatement of the accountants’ exemption or any other exemption given to accountants to be able to provide product advice without falling into the AFS licensing regime.

ASIC said such exemptions “are distortive and do not lead to a level playing field for accountants and other advisers. Further, they would result in an inappropriate level of regulation, and corresponding consumer protections, for what is very important advice for consumers.”

The regulator also noted that the financial services royal commission had made particular note of the large level of carve-outs in financial services laws, and had suggested removing existing carve-outs rather than adding new ones.

While conceding that some aspects of the current limited licensing regime needed simplifying, ASIC suggested that “through our work, we have not seen evidence that TFAs or accountants provide more compliant or better financial advice than other advisers and so do not believe concessions from the advice regime for accountants can be justified on this basis”.