Financial adviser register is a work in progress

The Australian Securities and Investments Commission's new financial adviser register, which will be launched on March 31, will need to be reviewed to address a number of shortcomings, according to an industry expert.

Veda's head of wealth, Mark Hoven, said the register had two major flaws: licensees are not required to verify adviser details before posting them on ASIC's MoneySmart website; and the register does not capture ongoing professional education undertaken by an adviser.

The purpose of the register is to allow investors and employers to check an adviser's credentials. Information on the register will include the adviser's status and experience, qualifications, professional memberships and current and previous employment going back five years.

It will also list the adviser's areas of competence and any bans, disqualifications or enforceable undertakings.

The education and qualification requirements have an extended deadline of May 31.

Hoven said the onus was on organisations submitting details to get them right and there were sanctions for getting it wrong, but there was no requirement to go through a formal verification process.

He said a number of financial planning groups were mandating ongoing education for their advisers in a bid to raise standards. "This could be captured," he said.

"I think consumers will get value out of this but there are opportunities to enhance the design. This is a starting point," Hoven said.

Veda has an employment checking service called Verify and has customised the service to working with financial planning groups to verify their data before it goes on the register.

Hoven has been surprised by the variance in the approaches organisations take and the quality of their data.

"There is room for improvement. There is asymmetric risk with quality assurance. A few exceptions can blow you up."

Hoven said Veda's records show that the most common errors in employment records related to the actual employment record, followed by industry qualifications and academic record.