A Sydney-based AFSL holder has agreed to close some of its digital advisory offerings after ASIC made approaches to it with concerns over the quality of advice distributed by the robo tools.

The online robo tools concerned were providing automated financial product advice using algorithms and technology with no flesh-and-blood advisers involved. The areas of advice were about budgeting analysis, life insurance reviews and investment recommendations, with another tool dealing with SMSF establishment, buying property through an SMSF, as well as contributions and commencing or ending a pension account.

A sample of the advice files by ASIC saw concerns raised about both the quality of the advice being generated by the robo tools as well as the ability of the AFSL holder to monitor it in an ongoing capacity.

ASIC says it was concerned that the level of inquires made by the online tools about client objectives, financial situation and needs, were inadequate. In some instances, the recommendations generated by the tools were in conflict with client goals or with other recommendations also generated by the tools. Readmore