The Property Investment Professionals of Australia welcomes the release of the Australian Securities and Investment Commission first SMSF taskforce findings.

PIPA applauds the regulator for its recognition of concerning property spruiking activities with regards to self-managed superannuation funds.

The report, which focused largely on the standard of advice provided to SMSF trustees, found that the majority of advice provided is ‘adequate’ but it noted pockets of ‘poor’ advice, particularly with regards to recommendations that investors set up an SMSF in order to invest in real property.

Moreover, ASIC noted its concern regarding a rise in aggressive advertisements pushing property investment through SMSFs.

ASIC commissioner Peter Kell said ASIC did not want to see SMSFs become the vehicle of choice for property spruikers.

“Where we see examples of unlicensed SMSF advice, or misleading marketing, we will be taking regulatory action,” he said.

Such news is welcomed strongly by PIPA, which has long held grave concerns about property spruikers, particularly those targeting SMSF investors.

As ASIC would be fully aware, reports of Australian investors suffering at the hands of unscrupulous marketeers are all too common and such cases have the potential to explode as interest in property investment via SMSFs continues to grow.

While PIPA welcomes ASIC’s heightened awareness of property spruiking, the association remains concerned about the provision of advice with regards to property investment within SMSFs.

ASIC’s investigation found that the majority of advice provided to SMSF trustees by financial planners and accountants is adequate.

While ASIC remains comfortable for such professionals to provide advice on property selection however, PIPA believes trustees not only require but deserve specialised property investment advice.

From PIPA’s perspective, financial planners and accountants lack understanding and formal education in relation to real property so we believe they have two choices when it comes to providing their clients with advice around SMSF property selection.

One, they can refer their client to someone who does have formal property investment advice accreditations – or they can undertake their own formal qualifications in order to deliver qualified property investment advice and a more all inclusive service.

PIPA will continue to lobby the Australian government to regulate the property investment industry – and this is top of our agenda.

But for the here and now, we are calling on financial services professionals to act in the best interests of the customer,and either up-skill in order to provide advice around property investment, or refer your client to someone who is appropriately accredited.

Ben Kingsley is chair of Property Investment Professionals of Australia.

19 April 2013
Property Observer Online:
http://www.propertyobserver.com.au/industry-news/concerns-about-unscrupulous-property-spruikers-remain-ben-kingsley/2013041860564?utm_source=po&utm_medium=aida&utm_campaign=industrynews