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FBAA has raised concerns about the number of people entering the industry who are not trained as mortgage and finance brokers.
According to the association, in July 2011, there were more than 20 thousand Australian credit licences (ACL) and Australian credit representatives (ACR) in the industry with 92% being brokers.
However, in four years, combined ACL and ACR figures have jumped to 39 thousand with only 56% noted as being broker-trained.
FBAA chief executive officer Peter White is concerned at the huge variation and big increase in non-brokers holding this status.
“The total market of these credit licence and representative holders has climbed a staggering 88% but the broker markets only risen 15 out of that 88%,” he said.
“It’s a worry because these additional entrants in the consumer lending arena are not brokers per se and pose a concern as to conflicts of interest and possible poor advice.”
White believes that many credit reps, such as accountants and financial planners, are cross-pollinating in to the broking market.
“Who holds these ACR holders accountable and responsible for their conduct, their ongoing education and to see that best practice is met?
“If accountants, financial planners or anyone else in the industry want to act as brokers, you have to undergo specific and designated training to suit the needs of customers.”
ASIC’s rules clearly state that credit representatives who provide mortgage broking services must have at least a certificate IV in financial services and undertake at least 20 hours of continuing professional development each year.
