Ten years on from when the regulator first called for the removal of bad apples from the financial planning industry, there's been not enough progress.
It was a decade ago that the regulator, the Australian Securities and Investments Commission, first called on employers to conduct reference checking on planners before they employed them.
How better protected would have been the clients of financial planners if the biggest employers of planners had acted way back then, we will never know.
In 2007, ASIC even launched a handbook with a reference-checking framework to be used by employers. It has repeatedly warned employers that they need "robust recruitment processes" ever since.
It is not a panacea of the problems that have cost hundreds of thousands of mostly retiree investors to lose their money, but it would have helped. Too often a candidate's success in meeting sales targets was at the top of the list.
And the tougher financial planning laws that will help better protect consumers are relatively new.
But according to ASIC's review of financial planning at the big banks and AMP that was released last week, a lot more work needs to be done on weeding out the bad apples.
In releasing the report, ASIC deputy chairman Peter Kell criticised the banks for their failure to always carry out adequate reference checking when they employed financial advisers.
He voiced his frustration that it was a decade ago that ASIC raised the issue with them. He said if nothing was done this time around, he was prepared to shame those banks that didn't change their ways.
The Australian Bankers' Association's recently announced a Reference Checking and Information Sharing Protocol.
Kell said ASIC will be watching how that goes and expects to see a rapid improvements in the checking and provision of adviser references.
For too long bad apple advisers have been allowed to shift between employers.
In 2015, the regulator launched a register of financial advisers that includes the adviser's name, registration number, the adviser's licence and employment history.
It shows the owner of the financial services licence, including the parent owner of the company under which the adviser is licensed. It also shows what products they can advise on.
Importantly, it also shows disqualifications, banning orders and enforceable undertakings.
But there are several things that are not on the register, such as police checks on planners and whether the planner has ever been declared bankrupt.
And the employment history goes back five years only. Crucially, it's an honour system; there's no official vetting that the information that is on the register is correct.
There's a temptation for employers to have the bad apples move to another employer as quietly as possible. They may be reluctant to give a bad reference to a potential new employer for fear of litigation.
But while the register helps, it is the responsibility of the financial-planning licensees and their authorised representatives to ensure they are hiring planners of good character in the first place.
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