Alexander Euvrard

Self-licensing specialist My Dealer Services (MDS) expects even stronger growth in 2026 as more financial advisers look to take control of their businesses and come to understand the associative risk of working under large licensees following ASIC suing Interprac Financial Planning over the failure of two large funds.

Interprac is being sued for alleged failures around the now collapsed Shield and First Guardian investment funds where more than 6,500 superannuitants were advised to invest around $677 million.

MDS Managing Director Alex Euvrard said the fund collapses had shaken many advisers and made them realise the potentially costly associative and reputational dangers of being associated with licensees especially as many of the systems, processes and even APL selection is out of their control. This has been especially highlighted through platform providers refusing to take on new clients from advisers under Interprac.

“MDS has already received a number of approaches from advisers wanting more control over their own destiny. Advisers like self-licensing as a way to control their business and make their own choices about how they treat their clients and where they place their money without the scrutiny of a parent licensee and being dictated to by templates. The greatest thing about the advancement of technology and services is that smaller licensees can now access and plug in support services that deliver leading compliance, software, investment and practice management solutions, functions traditionally held with the larger licensees.” he added.

“MDS grew the number of self-licensees it services by 20 per cent to 120 in 2025 and despite up to 15 per cent of the industry forecast to potentially depart at the end of the year because of the introduction of two pathways to remain on the Financial Adviser Register, we are proud that we have already managed to shepherd all of our more than 400 adviser members through the rigours of the new requirements,” Euvrard said.

MDS Head of Strategy Ashley Mahadeea said the rapidly growing business had managed to continue to swell its membership base following a sold-out full day briefing event in Sydney and by hosting a series of roundtable lunches around the country that helped members feel the sense of community within MDS.

“MDS has also introduced 10 new and five enhanced supplier partnerships this year that give MDS members access as well as pricing benefits to best-in-class providers. These included platinum and gold partnerships with Morningstar, HUB24, Lonsec and intelliflo.

“We remain dedicated to empowering members with resources and partnerships that drive better client outcomes. Carefully selecting the right product and service providers to support MDS members is another step toward that commitment.

“In 2026 we will continue to provide hands on compliance solutions for our members, increase our advocacy work to explain the benefits of self-licensing and uplift our internal technology to create more efficiency for the business and our members,” Mahadeea added.

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Respondents to the MDS survey acknowledged that the growth in consumers needing professional advice will grow as practitioners exiting the sector accelerates said Euvrard.

“Although a negative on one side, the exodus was also regarded as an opportunity with 42 percent of advisers confirming in the survey that they would acquire books of business to facilitate growth.

“While 26 percent of respondents initially said they were unsure about pursuing acquisition opportunities, many in this group have now affirmed they will do so utilising the MDS facility”.

Euvrard confirmed that he had extensive conversations over many months with financial advisers about this matter and the insights received, together with those revealed in the survey, provided the foundation for MDS online offering.

In addition, principals of financial advisory practices outside MDS seeking to sell their businesses will also be able to access the facility.

The survey is one of the activities MDS utilises to connect with its network of AFSLs and financial advisers.  Much of the feedback received from the 2021 survey will be implemented into new service offerings over the coming year with the buy sell online facility the first of these initiatives.

Euvrard went on to say that revenue growth will be an industry imperative as the cost of providing advice grows and standing still is not an option in this environment…hence the importance of acquisition to underpin business growth.

“Furthermore, the usual practice of engaging an agent or broker to facilitate a commercial outcome when buying or selling an advice business or book of clients is no longer appropriate”, continued Euvrard.

“Unfortunately, far too often this is undertaken at the last minute and the resultant lateness of the transaction results in less than satisfactory outcomes for buyers, sellers and the acquired clients.

“In a time poor, highly regulated and scrutinised industry this practice is unsustainable and fraught with unnecessary risk.”

“Our objective via the online resource that will go live on the MDS website next month – is to provide an easily accessible, yet confidential and neutral facility much earlier in the process of bringing buyers and sellers together”, said Euvrard.

“Buying or selling a financial advice practice or book of clients comprises many pieces to an often complex and emotionally charged undertaking.  This is especially true for mature age advisers that have devoted a lifetime of endeavour to their business.

For practice principals committed to the future, the current environment of advisers exiting the industry provides an unprecedented window of opportunity to facilitate growth through acquisition.

Apart from securing the best price, advisers that have decided to exit are keen to connect with the right buyer that will ensure continuity of professional advice and service to their clients – and employment for staff and paraplanners.

As well as bringing buyers and sellers together, the facilities, services and extensive experience of MDS that has successfully assisted and supported dealer groups and financial advisers to obtain their own license or establish robust compliance frameworks – will be available.

Utilising MDS’s compliance services, the group’s practices will have a better insight, understanding and appreciation of the business they are acquiring.

Euvrard concluded, “For over a decade, MDS has been assisting advisers and dealer groups to become self-licensed and then provided the compliance, business support required to operate in the challenging financial advisory environment.

“We are confident the timing is right for the new offering and it will be well received by principals seeking to grow their practices and advisers pursuing a successful sale and industry exit”.

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Commenting further, Euvrard said that advisers with their own AFSL has allowed them to be far more entrepreneurial and operate innovative client centric business models.

“Respondents affirmed there are challenges ahead for the industry with the most significant being 1) the current compliance regime that requires practices to devote up to 30 percent of time and resources to this undertaking; and 2) the exit of experienced practitioners”, added Euvrard.

“58 percent of the advice practices surveyed confirmed they were more profitable than two years ago despite the impost of compliance related costs impacting the finances of their businesses.

“The rising cost of compliance is unsustainable in the long run and needs to be addressed as an industry priority”.

Staff costs and increases in PI insurance premiums (some as high as 50 percent) were additional expenditure outgoings negatively impacting business profitability.

Survey respondents also viewed the growth in consumers needing professional advice as another industry issue that will deteriorate further as more and more advisers exit the sector as the deadline for academic qualification nears.

Although a negative on one side, the exodus of advisers was also regarded as an opportunity with 42 percent of advisers confirming that they were considering acquisition of books of business to facilitate growth.

While 26 percent of respondents said they were unsure if they would pursue acquisition opportunities, Euvrard was confident many in this group would do so.

Even though many mature age advisers were leaving, the uplift in education standards and qualification requirements was viewed overwhelmingly as a positive for the industry.

Asked what mattered most to their clients – it was the interpersonal relationship with the adviser that topped the list. Strategy to reach goals and investments was next, followed by investment returns.

Euvrard continued, “An overwhelming 98 percent of advisers affirmed that technology will play a bigger role in the future with benefits measured in reduced costs and improved operational efficiency. Most importantly, it will significantly enhance the client experience and provision of advice”.

“However, when it comes to technology and its impact on client engagement, the humble telephone was still number one as there was no substitute to speaking personally with a client”.

Although the primary focus of planning practices is the provision of professional financial advice, additional complementary services are being offered to clients and these are (in descending order):

• SMSF administration and related services
• accounting, finance and mortgage broking facilities
• estate planning and aged care
• budgeting and cash flow management services

“Demand by mature age clients is expected to increase considerably reflecting the nation’s ageing population and the largest intergenerational transfer of private wealth in Australia’s history”, said Euvrard.

“Although a major marketing opportunity, it requires advisers to improve their skills and knowledge in this highly specialised undertaking”.

Asked about their views regarding the investment outlook for 2021 and 2022. The survey respondents believed there are headwinds ahead with the biggest threats being:

• geopolitical risk
• inflation
• inflated valuations of the stock market

Euvrard concluded, “MDS is very pleased with the results of the recent survey, especially as it has reaffirmed the positive mindsets of self-licensed advice practices and their outlook for the future.

“Increased professionalism of the advice sector will lift the standing of the industry and act as a beacon attracting the next generation to consider a career as a financial advice practitioner.

“Technology will definitely assist in reducing costs, improving client engagement and facilitate and encourage growth through acquisition opportunities.

“However, of the challenges ahead, the most crucial is the impact of compliance and regulators need to heed the calls of advice professionals for a more workable and practical framework going forward”.

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“The number of advisers opting to have their own AFSL is accelerating in line with industry changes such as a resolution to FoFA, grandfathering and it is becoming obvious that professional practitioners are moving towards an environment that gives them charge of their destiny without collective restraints”.

Euvrard went on to say that MDS has six (6) applications that were submitted to ASIC recently for new licences and based on the constant stream of telephone calls and information requests he is confident the trend will continue for the remainder of 2015.

In contrast, the number of enquiries received by MDS from accountants is significantly lower and this can only be a concern for the sector with the end of the exemption for accountants looming on the horizon.

MDS does expect that this situation will change rapidly in coming months as accountants realize that time is running out and RG146 qualifications will require a significant amount of time to complete successfully.

Euvrard went on to say the he welcomed ASIC’s significant tightening of their criteria over the past year as now only dedicated professional practitioners will obtain an AFSL.  “Although the licensee cannot shirk their responsibilities and obligations, MDS is able to provide outsourced cost effective solutions to assist them to meet these obligations compliantly”.

“In our experience, approximately 80% of AFSL applicants sign up for the ongoing assistance from MDS once they receive their draft licence. This service includes continuing professional development for authorised representatives, monthly regulatory updates, research, software, PI, attendance at bi-annual Professional Development Days and the list goes on. It is like being in a dealer group except with your own AFSL.”

Alex Euvrard concluded, “Without a doubt, the driving force behind interest in the MDS marketplace offer is the demand from advisers seeking a viable cost effective AFSL facility that provides them with independence and control over their destiny whilst operating within a fully compliant environment.  I am confident that MDS will continue to provide innovative solutions and opportunities for an industry that is constantly evolving and responding to consumer demand and legislative requirements”.

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