An Australian Financial Services Licence (AFSL) is imminent and the family real estate business, which has a network of 750 real estate agencies across Australia and 500 mortgage origination brokers, is expected to open its financial planning business before Christmas.

The new business, Wealth Market, will be headed by Jason Powell, who has a background in the financial planning industry, including Professional Investment Services and management roles at Commonwealth Bank's financial planning division between July 2007 and October 2010, when the financial planning scandal erupted and allegations of file tampering and cover-ups were made in the senate committee.

News spread like wildfire as the industry digested the implications of a real estate agent with mortgage broking and insurance businesses building an army of financial planners to flog wealth management products. At issue was whether the new business was simply about real estate agents capturing more of the value chain in property advice (including SMSFs) and the inherent conflicts that would create.

It comes a day after submissions closed into a Senate economics legislation committee review into financial services reforms, which in June took the controversial decision to recommend a windback of the future of financial advice (FOFA) legislation.

The original iteration of FOFA never went far enough because it allowed financial planners selling insurance products to still earn commissions. Ray White sells houses and earns a commission, it sells insurance products, which earn a commission and it sells home loans through its mortgage broking arm, which are also commission-based. The bigger the loan, the bigger the up-front fee and trailing commission.

Financial Standard reports that the Ray White business has posted ads on LinkedIn saying: "Servicing a massive referral network from Ray White and Loan Market, this role will support the internal network of these businesses (20,000 people nationally) by developing productive relationships, conducting seminars, producing thought pieces and ultimately by proactively offering advice, products and services to meet their needs."

It also says the successful applicant will need a "solid sales background" as well as strong working knowledge of "all financial planning areas".

Ray White boss Brian White told me the planning arm would be independent rather than tied to the banks or AMP, but he said down the track he could not rule out the business creating its own products, a move that would create numerous conflicts of interest.

Ray White's move into financial planning comes as fears intensify that Australia is heading towards a speculator-led property bubble, largely spurred by self managed super funds, which have grown like topsy in the past few years - with more than a million SMSFs accounting for more than $600 billion of retirement savings. SMSFs have less asset diversification than retail and industry funds.

Against this backdrop are a series of Senate inquiries, triggered by various financial planning scandals, including the Commonwealth Bank financial planning scandal.

The scandals, exposed in Fairfax Media, have shone a light on the minimal standards of education in the financial planning industry, which require less training and education than a hairdresser.

When asked about education standards and whether financial planners would need to have a tertiary education, be a member of a profession or be a certified financial planner, Brian White said: "the planners will be professionally selected".

It has prompted a Parliamentary Joint Committee inquiry into "professional, ethical and education standards in the financial services industry", which includes looking at setting up a national register to track financial planners and keep tags on the bad apples.

A few weeks ago the Senate passed a motion for an economics committee inquiry into financial advice and the banks.

It follows a Senate inquiry into the performance of ASIC and the CBA, which recommended in June a royal commission into CBA, an investigation into Macquarie Private Wealth and an overhaul of the regulator.

Jeff Morris, a former financial planner with CBA, who blew the whistle on the financial planning scandal inside the bank, said he was surprised at the move by Ray White.

"The financial planning industry needs to move away from large players seeking to harvest sales from databases if it is ever to become a true profession," he said. "Mandatory higher educational requirements for planners across the board would at least prevent minimally qualified planners being used as a cheap sales force."

Hear, hear.