Michael Harrison

Highly-respected business strategist and former Synchron Independent Chair, Michael Harrison, passed away in Melbourne on Sunday morning, 21 May 2023, after a long illness. He was 78.

Mr Harrison worked closely with Synchron from 2007, when he was appointed Synchron’s business strategy and marketing consultant. He then served as Chair from April 2011 until the sale of the group to WT Financial last year.

Long-time colleague and friend, Don Trapnell, said Mr Harrison made an enormous contribution to Synchron, and in many ways helped reinvent the business.

‘With his help, we transformed Synchron into one of the largest non-institutionally owned licensees in the country and a preferred dealer group for both younger advisers and our traditional network of older advisers,’ he said.

‘He was one of the main instigators of our ground-breaking NextGen bootcamp for young advisers and industry participants, and he went with me to the UK in 2015, to uncover the real story in relation to life insurance commissions in that part of the world.’

Mr Trapnell said he believes the findings he and Mr Harrison brought back from the UK informed debate on the issue of risk remuneration in Australia and helped shape the future.

Mr Harrison was also instrumental in Synchron’s legal battle against the State Revenue Office (SRO) of Victoria over the imposition of payroll tax on the earnings of financial advice practices that did not employ two or more people.

‘It was Michael who successfully led that fight, saving not only Synchron, but potentially all licensees across the industry, from a hefty payroll tax bill that could have had a profound negative impact on their businesses,’ he said.

‘He was not just committed to Synchron’s success, but to the ongoing success of financial advisers, particularly risk-focussed advisers. He deeply understood the financial services landscape and the drivers of change. I greatly respected his business acumen and will profoundly miss his friendship.’

In the early 80s, Mr Harrison established Australia’s first private bank. He also served three terms as Deputy Lord Mayor of Adelaide and, over the course of his long career, sat on government and private company boards, including the Australian Formula One Grand Prix.

Mr Harrison consulted to numerous clients including Citibank, the STAR Alliance Network, the Australian Competition and Consumer Commission (ACCC) and Zurich Financial Services, where, in 1997, he was charged with the responsibility of reinventing Zurichʼs Australian life insurance business.

He was also the author of three books, a Fellow of the Australian Institute of Management, and a Life Member of the Million Dollar Round Table.

Mr Harrison is survived by his wife, Pam, and five children, and will be farewelled at a private family funeral, as per his final wishes.

Mr Trapnell has prepared a video tribute to Mr Harrison which can be viewed via the following link:

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Phil Osborne

Speaking at the Synchron Conference in Darwin last week, Synchron General Manager, Compliance Phil Osborne said that just like music, the financial advice profession could be considered in terms of non-negotiables and guidelines.

Drawing a parallel between the two seemingly divergent occupations is something that Mr Osborne is well qualified to do, having graduated from the Victorian College of the Arts School of Music before entering the financial services industry and obtaining Masters degrees in both law and commerce.

“Where the similarity between the disciplines becomes apparent is through what is required of every participant and what is left to the individual to interpret,” Mr Osborne said.

“For example, things like what key you’re in, what timing to use, note and rest values, and so on, are all non-negotiable directions for the musician. Other directions, for example the pause, which indicates to the musician that they can hold a note for as long as they wish, are guidelines.”

Mr Osborne said similar things are true in financial services. “As non-negotiables we have the laws that govern the industry, and guidelines like regulatory guides and past experience.”

While the laws are clear and include The Corporations Act, Common Law – Equity and Fiduciary Duty, the guidelines leave a little more to the adviser’s discretion.

“These guidelines include what I’d call ‘greatest hits’ like RG 175 but there are also some more obscure, or ‘B Side’ tracks,” he said, “including RG 36 that talks about when advice has actually been given.”

Other guidelines include precedents. “They were developed as part of the common law of Equity and are a major guiding factor in court rulings; once issued they provide guidance for future occurrences. Think of precedents as the cover bands of financial services governance,” he said.

However, there are also some things which might straddle both non-negotiables and guidelines – the Code of Ethics in the manner it has been established, for example.

“On the one hand, through its inclusion in the Corporations Act Section 921E – the Code of Ethics is non-negotiable, on the other, as a series of ethical standards, it’s a set of guidelines to be interpreted by advisers who come from different backgrounds with different experiences.”

When thinking about compliance, Mr Osborne said that while there is room for interpretation, advisers need to be very careful.

“Music is made up of both sounds and silences. What we need to remember is that where a silence might exist – that is, where legislation is not prescriptive – we don’t necessarily need to fill it with rules or regulations,” he said. “We need to work with the silences we’re given to exercise our professional judgement and continue to work with government towards principles-based regulation.”

Mr Osborne said that it’s very important for financial advisers to get this right. “If musicians ignore the non-negotiables, and are poor at interpreting the guidelines, the only consequence will be bad reviews; if advisers do the same, they will likely end up facing regulatory action or possibly the courts.”

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Don Trapnell

WT Financial Group Limited (WTL) has announced the acquisition of high profile, non-institutionally-owned licensee, Synchron.

Synchron founders Don Trapnell and John Prossor will continue working in the business with Mr Trapnell assuming the role of chairman of WTL’s Synchron subsidiary.

The move follows WTL’s acquisition last year of the Sentry Group and continues the listed company’s growth strategy. The WTL adviser network, which also includes the licensee group, Wealth Today, will emerge with more than 600 advisers and increase funds under advice to in excess of $16Bn following the Acquisition.

The total vendor consideration for the Acquisition is up to $7.96M, payable over two years in a combination of cash and WTL shares, and subject to various terms and conditions.

WTL will assume liabilities of circa $3M and expects to incur transaction and integration costs of between $1-2M, bringing the anticipated total value of the Acquisition to $12-13M.

Synchron Director, Don Trapnell said, “Synchron has a long and proud history as a licensee that values its people. In the process we have built a strong, close community of advisers with a unique culture.”

Mr Trapnell said that WTL understands this culture and embraces the same values. “We thought very carefully about the cultural fit, and we are delighted that the Synchron we all know will continue,” he said.

“This is a pivotal moment in our history, one which will allow us to equip Synchron advisers for an exciting future in financial advice, while also positioning us for growth, and ongoing leadership of the industry as a licensee.”

The Synchron name will remain and all scheduled Synchron events will proceed as planned.

“As we move into a post-pandemic world, and new opportunities emerge, this is the right fit for Synchron, at the right time,” Mr Trapnell said.

WTL Managing Director, Keith Cullen, said the Acquisition cements WTL as the largest non-institutionally-owned, non-product-producing financial adviser network in Australia.

“It establishes the right scale of operations to enable us to provide the critical support that advisers in our modernised industry demand. The resulting scale will set the course for future expansion and more depth in our offerings for advisers,” he said.

“Thanks to the Acquisition structure, the Synchron founders will maintain investment exposure to Synchron by holding shares in WTL as we continue to advance as a leader in the Australian financial advice sector.”

Mr Cullen said WTL will be enhanced through the addition of Synchron’s state manager line, adding significant experience and resources to the broader group operations to support the Company’s advisers across its Wealth Today and Sentry groups.

Synchron’s NextGen program, which supports the professional development of younger advisers, will also be rolled out right across the group. The program has helped reduce the average age of Synchron advisers to 47.

“Synchron advisers will benefit from the rollout of WTL’s adviser education and training programs, its comprehensive practice management tools and programs, and its enhanced risk management framework,” Mr Cullen said.

With millennial inheritance from 2020-2040 forecast to reach $3,500Bn, superannuation assets expected to double by 2029, and the largest cohort ever to enter age care, Mr Cullen said demand for advice will continue to grow across Australia.

“The landscape within the financial advice sector has a strong outlook, and the synergies created from the Acquisition position us for further growth.”

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Phil Osborne

Calls for a change to “target a principles-based regulation framework” put forward by Senator Jane Hume should be considered carefully and not be a knee-jerk reaction for popular support, according to Synchron’s General Manager – Compliance, Phil Osborne.

“While principles-based regulation is the ideal destination for how we should be allowed to operate as an industry, we should regard this as a destination that will be arrived at after a bit more of a journey,” he said.

“We need to think of this in terms of the application – whose principles will be applied? Will we be allowing advisers to use their professional judgement and be guided by ethical standards, as has been promoted since the introduction of the Code of Ethics? If so, what happens when the regulator disagrees with the advice provided? Do we then have to discount the principles under which advice was actually given?”

Mr Osborne also believes an important, often overlooked consideration is the application of the principles of the consumer.

“How is a nuisance complaint to be treated? Under current requirements, the Ombudsman will always allow the client to decide whether to continue with the complaints process, regardless of whether there is any merit in their case,” he said. “With no disincentive for the client, the advice community is subject to the danger of moral risk under a principles-based system.”

Though many look at the ‘safe harbour’ steps of the client Best Interests Duty as a checklist to be completed, Mr Osborne sees these as guidelines to support an advice business.

“The concern is that should these steps be removed, what will then be in place for an adviser to rely on to demonstrate they have acted in an appropriate manner when dealing with the client?” he said. “Let’s not forget that before the ‘Best Interests Duty’ legislation, the requirement was to have a reasonable basis for recommendation. To remove the safe harbour steps goes back to an argument as to what is reasonable or not and removes an objective measure that provides an adviser with some form of defence, as well as a benchmark by which they can be held accountable.”

As for the domination of checklists causing compliance complication and micromanagement, this is a concern with which Mr Osborne wholeheartedly agrees.

“Over the years, checklists that were simple and performed a valuable function have been bastardised – continually being added to and expanded to the point where we’re now seeing checklists for the checklists.

“Adding something to a process doesn’t necessarily mean it’s an improvement. It’s the mentality of compliance departments to add extra things to supposedly improve compliance that now sees the industry overwhelmed by monumental amounts of documentation. Checklists, lengthy advice documents, onerous fact-finding demands have all had the effect of creating a bureaucracy that doesn’t support our actual purpose – to provide a service to  clients.”

What also needs to be considered, according to Mr Osborne, is the way in which the industry has fumbled its opportunity to apply principles-based regulation via the Code of Ethics introduced in January 2020.

“The fact that it took the industry two years to understand that a concern for conflict of interest didn’t actually mean referral payments were banned under Standard 3 doesn’t bode well for how regulation on a principles-basis would actually be applied,” he said.

While he supports the evolution of the industry over time to a principles-based regulatory regime, he believes the industry right now ultimately needs to step back and assess exactly what the legislation that is in place actually requires.

“The legislation we have now is not that prescriptive or onerous. With the ability to interpret what is there it already provides us with what many are seeking from principles-based regulation. Let’s get used to working with the Code of Ethics in conjunction with the spirit of the current legislation before we go changing anything.”

Mr Osborne said the current situation reminds him of an Oscar Wilde quote. “When the Gods wish to punish us, they answer our prayers. In other words, let’s be careful what we wish for – let’s not throw away the objectivity and protection advisers enjoy with the safe harbour steps until the industry has evolved to the point they’re no longer required.”

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Emma Crothers

Synchron has appointed Emma Crothers as SA/NT State Manager. Based in Adelaide, Mrs Crothers most recently ran her own consultancy, Fusion Practice Solutions, which provided project management and administration support services to financial planning businesses.

Announcing the appointment at a bringing together of Synchron advisers in Adelaide last week, Synchron Director Don Trapnell said, “Emma’s long experience working with financial advisers and the fact that she is a Synchron NextGen graduate, means she has an excellent understanding of the challenges and ambitions of Synchron advisers. We are looking forward to working with her as she continues to grow and develop our adviser force in South Australia and the Northern Territory.”

Mrs Crothers started her financial services career in 2004 with the Bank of South Australia, before moving on to a financial planning assistant role, followed by a financial planning practice support role, with Professional Investment Services. She then worked in client development management with AIA for more than five years before launching her own consultancy. She has received multiple employer awards and was a finalist in Money Management’s 2018 BDM of the Year awards.

“I am super excited to be joining the Synchron team and begin working with the SA/NT advisers,” she said.

Mrs Crothers’ appointment follows the tragic passing of Synchron’s well-respected former NT/SA State Manager, Chris Regenass. In extending his sympathy to the Regenass family at that time, Mr Trapnell said Synchron had lost one of its own, a member of the Synchron family, who would be profoundly missed.

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Phil Osborne

A recent call by some industry commentators to move to a ‘Letter of Advice’, is simply playing with semantics, according to Synchron’s new General Manager – Compliance, Phil Osborne.

“Discussions around what to call the advice document don‘t actually address the core issue – which is the unnecessary length and complexity of Statements of Advice,” he said. “Calls for a ‘Letter of Advice’, while highlighting the issue, is looking in the wrong place for the cause of the problem.”

Mr Osborne said that Synchron believes the solution is in fact far simpler than a name change.

“We can either take years going through the process to discuss and legislate and change the name of the document, or we can act today and choose to follow what the Corporations Act already requires us to do, and that is to have an SOA that is, ‘worded and presented in a clear, concise and effective manner.’”

Mr Osborne referenced section 947B/C(6) of the Corporations Act, the section that directs that a Statement of Advice must (not “could” or “might”) be clear, concise and effective; something that Synchron sees as being generally ignored by industry compliance regimes.

“Section 947B/C(6) is as much a legal requirement as the need to act in the client’s best interests (section 961B) or to provide additional information in the event of recommending a change of financial product (section 947D),” he said. “Yet for some reason, compliance regimes don’t seem to recognise this, instead requiring more and more to be included in the SOA – not for the benefit of the client, but for the sake of so-called ‘best practice’.”

Mr Osborne’s sees a big part of his role at Synchron as recognising where the advice documentation in place doesn’t meet this obligation, and to develop versions that will both meet the letter and spirit of the legislation, while creating a better experience for both advisers and their clients.

Mr Osborne argued that what seems to have been forgotten is that best practice is about what’s best for everybody. “We need to consider what is best for the client and best for the adviser,” he said. “A purpose that a shorter document would definitely serve.”

Blaming the disclosure regime also misses the mark, according to Mr Osborne.

“Regulatory Guide 175 is clear when talking about disclosure and the need to be clear, concise and effective, directly in keeping with its counterpart in the legislation,” he said. “While everyone is very quick to point fingers at legislation and the regulator, that isn’t where the blame lies.

“The work that ASIC has done recently on advice documents as part of their affordable advice project has highlighted that they don’t believe long documents are in the best interests of the client either, regardless of the disclosure regime.”

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Phil Osborne

Synchron has appointed Phil Osborne as General Manager, Compliance, effective 1 February 2022. Mr Osborne has been working with Synchron as a Compliance Consultant since July 2021.

Mr Osborne holds Masters’ qualifications in both Commerce (majoring in financial planning) and Law (majoring in enterprise governance). He also holds the Certified Financial Planner (CFP) designation and has been a director and responsible manager for a number of financial services licensees.

Synchron Director, Don Trapnell said, “Phil has over 30 years’ experience in financial services and, having also previously managed financial planning practices and provided financial advice himself, has an exceptional understanding of the demands on financial advisers and the vital role they play in helping ordinary Australians take control of their financial affairs.”

Mr Osborne has held various roles with numerous financial services businesses, including Lifestyle Asset Management, the SMSF Advisers Network, and Interprac Financial Planning, following his entry to the financial advice industry through AMP and Hillross Financial Services.

Mr Osborne reports directly to the Synchron Board and heads a compliance team which includes Alison Massey, Head of Compliance – Advice Assurance. He will also be working closely with the Head of Compliance – Policy and Regulatory, Hanna Abdullah.

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Terry Johnson

Synchron adviser, Terry Johnson from Keyman Financial Services in NSW, has won an inaugural AFA Great Advice Award (the Award).

Don Trapnell, Director of Synchron said, “We congratulate Terry on winning the NSW state Award. Terry is a risk specialist who has been a highly valued member of the Synchron community of advisers since 2018.”

Mr Johnson has been in the industry for more than 20 years and has built a business that puts the claim outcome front and centre.

“We give advice as if our client is going on claim tomorrow,” Mr Johnson said. “We believe that the true worth of a risk specialist adviser is only really tested at claim time, the rest is the pre-game.”

In announcing Mr Johnson’s win at the AFA’s recent EVOLVE conference AFA National President, Michael Nowak, said, “Terry has many claim stories of which to be proud. Not only has he administered pro bono claims, but he always shows the utmost care to his clients when they need it the most.”

Mr Johnson said, “I want it to be as easy for the mum and dad and tradie with three kids and a mortgage to access affordable insurance advice as and when they need it, as it is for a CEO or high income earner, if not more so.”

Keyman Financial Services is a small family business, now operating in the NSW Hawkesbury region. Mr Johnson’s adult children, Benjamin and Mia, are employed in the business and both are currently undertaking their Professional Year.

Mr Johnson appeared with Synchron at the Standing Committee on Economics (the Committee) in July 2021, where he spoke about the impact of over-regulation on advisers and on inflows, which ultimately led to increasing premiums resulting in fewer people holding onto or taking out life insurance.

“It is a self-feeding cycle…that needs a circuit breaker,” he said at the time, “and it needs it urgently.”

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Don Trapnell

Synchron is offering Synchron advisers and Synchron staff a $100 Bunnings gift voucher if they have both doses of a COVID-19 vaccine.

In a letter to the Synchron community, Director Don Trapnell said that Synchron believes the best way for Australia to return to a life that reflects life before the pandemic is for as many Australians as possible to get vaccinated.

“COVID-19 has had a devastating effect on the health and prosperity of the world and although Australia has been thankfully largely spared, we are not immune, as evidenced by the current outbreak and extended lockdowns in Melbourne,” he said. “Synchron’s directors and chair have each received the first dose of the vaccine and we will be proceeding to the second dose, within the prescribed timeframe.”

Mr Trapnell strongly encouraged the Synchron community to visit their doctor to find out which COVID-19 vaccine is right for them. “We understand that getting vaccinated takes time out of their day and away from their work, but we think it’s worth it,” he said.

The $100 Bunnings gift voucher will be given to Synchron advisers and Synchron staff upon proof that they have received both doses of the vaccine. Proof may include a Medicare vaccination report or any other proof, such as a letter from their General Practitioner.

“This is a potential investment by Synchron in the health of its community of up to $50,000, but we consider it a matter of good corporate citizenship,” Mr Trapnell said. “It is a small price to pay if it encourages our people to get vaccinated, and in the process contributes to the future ongoing health and prosperity of Australians, and helps restore the freedoms of Australia.”

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In announcing the appointment, Synchron Director, Don Trapnell said, “Ben began working in financial services in 2005, and was most recently a Business Development Manager with Challenger Limited in Brisbane. He brings with him an enormous amount of enthusiasm for the industry and a passion for adviser engagement.”

Mr Donohue’s career in financial services began with ING. He then spent over 12 years in business development roles with Asteron Life before joining Challenger. He has experience in retail life insurance, retirement income and aged care, and holds a Bachelor of Business (International Business) from the Queensland University of Technology, as well as an Advanced Diploma Financial Services from Kaplan Australia.

“I very much look forward to working with Synchron’s Queensland advice firms,” Mr Donohue said. “Domiciled from Cairns to the Gold Coast, Synchron’s Queensland advisers are delivering outstanding client outcomes, ranging from child cover to aged care. I’m very pleased that I will be helping them to further build and develop their practices, and make the most of the many opportunities available in the current environment.”

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