The chief executive of the Finance Brokers Association of Australia (FBAA) Peter White said he spoke out over unethical mentoring practices because the association has an obligation to protect the industry.
Mr White said while he copped some flak online, the overwhelming response from brokers was positive.
“A little personal criticism doesn’t faze me because this issue is more important than me or any other individual. We can’t be afraid to tackle the tough issues even if it might offend someone.
“It is the conversation the industry must have, and after we raised the issue, we received even more examples of brokers who are distressed at the damage this is causing.”
However he emphasised that the FBAA is not opposed to brokers charging for mentoring.
“Mentoring is an important part of the process for new brokers and no one expects experienced brokers to do this for free.
“The issue here is new and often young brokers being duped into thinking they have no choice but to pay exorbitant prices because the mentor may have done a short course and uses the term ‘certified’.
“The term ‘certified’ is not a legal or regulatory term, neither does it mean anything officially,’ he explained, adding that new brokers should explore options so they are not exploited.
Mr White explained that the FBAA has worked hard for a long time to develop a genuine career path for the industry, which includes promotion of the sector among university students, free student membership and a pending apprenticeship scheme.
“We are not going to remain silent and see our work undone by practices that hurt the industry’s reputation.
“We want to encourage new industry participants, not take advantage of them.”
He urged brokers to act responsibly and ethically and said new brokers could contact the FBAA for advice.