You are a senior financial adviser, employed for the past six years by Donaldson Hall Financial Services

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Question:

You are a senior financial adviser, employed for the past six years by Donaldson Hall Financial Services
Pty Ltd (DHFS) who holds an Australian financial services (AFS) licence. Wes Donaldson (age 55) commenced his career 25 years ago as a life insurance salesman, and 10 years ago established the
DHFS partnership with Melinda Hall (age 45). DHFS also employs Abi Blake (age 21), who is undertaking her professional year.

Wes Donaldson's clients are mostly aged 55 and older, with retirement planning and insurance considerations as their primary needs. Many of Wes' clients are successful business owners. Wes prefers to look after his existing clients and any new referrals are given to either Melinda or yourself, depending on the type of advice they are seeking.

Melinda Hall has 18 years experience as a financial adviser and her clients are predominantly aged between 35 and 55 years. Melinda's clients are mainly established professionals, with a number also being the children of some of Wes' wealthiest clients. Many of Melinda's clients have self-managed superannuation funds.

Abi Blake was originally employed as the firm's receptionist, and then become their in-house paraplanner. Abi has completed an approved Bachelor of Financial Planning degree, passed the Financial Adviser exam (previously known as the FASEA exam) and is currently in quarter three of her professional year as a Provisional Financial Adviser. Most of Abi's activities during her professional year are supervised by Melinda.

You have 10 years' experience as a financial adviser and are fully qualified. You have experience with a wide range of strategies and clients. Half of the clients you currently service came with you to DHFS from your previous AFS licensee. When Wes or Melinda is away or on leave, you also look after and provide advice to their clients.

Scenario:
Abi is about to meet with a new client couple, Marcus Alexander (age 25) and his wife Lisa (age 24). Marcus is the son of Wes' longstanding clients (and personal friends), Mark and Dawn Alexander.
Marcus works as an electrician and Lisa is a midwife working full-time at the local hospital. Mark and Dawn have insisted that Marcus seek financial advice now as Marcus and Lisa have recently placed a substantial deposit on a new home. The deposit was paid from Marcus' distribution from his late grandfather's estate. Marcus' parents want to ensure he has a financial plan in place, especially now that he has financial commitments (mortgage), is receiving regular (significant) distributions from his late grandfather's estate, and given he and Lisa are considering starting a family.

Abi has completed many client meetings, but this is her first meeting (indirectly supervised) in the capacity of Provisional Financial Adviser. She doesn't have very much information about Marcus and Lisa, but is aware that she is required to provide advice that will be in her client's best interests. While Melinda is away on leave, Abi asks for your support and guidance on how to approach this interview.

You ask Abi about her planned approach for the interview and she replies:

Marcus' parents have been Wes' clients for a long time and the family seem quite wealthy. Given the length of their relationship with Wes, I assume Mark and Dawn are both knowledgeable and comfortable with the general concepts of financial planning, risk and investing. I'm also assuming Marcus' parents will be guiding him on what to invest in,

so I shouldn't have to go into a lot of detail about financial plans and the relevant processes.

I've already emailed our financial services guide to Marcus and Lisa, so I'll get them to acknowledge first up in our meeting that they've received and read it. I'm assuming that I don't need to discuss insurance with Marcus and Lisa as they are very young and healthy (like myself) and Marcus has received quite a significant inheritance from his grandfather. I think initially they will just want some investment advice, particularly around the significant inheritance distributions, so they can really start to grow their wealth.

Melinda has shown me that for many of our wealthy clients, we often just follow their instructions given they have this wealth, they must know what they are doing. I think these meetings, as they seem to be the quickest and easiest, are good practice for me.

Questions:

(a) Define one barrier to ethical decision making and explain how it may influence Abi while she is planning for the meeting with Marcus and Lisa.

(b) Explain if Abi's conduct complies with Standard 4 and Standard 5 of the Financial Planners and Advisers Code of Ethics 2019 in her dealings with Marcus and Lisa.

(c) Discuss Abi's compliance with the value of Diligence in the Financial Planners and Advisers Code of Ethics 2019 if she proceeds with the interview as planned.