The federal government says legislation cracking down on financial planners will make the industry more professional.
Financial Services Minister Chris Bowen wants to ban financial planners from receiving commissions and benefits which may cause a conflict of interest.
He also thinks advisers should be required, by law, to put their clients' interests ahead of their own.
Mr Bowen said the changes would improve the industry.
"Thousands of Australians had their life savings wiped out by inappropriate financial advice," he told ABC Radio. "They have a right to be angry and we have an obligation to act."
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Mr Bowen admitted the reforms, expected to be formally announced later on Monday, would impact on financial planners' income - but said they'd have to adjust.
"Customers and clients, when they're seeing a financial planner, deserve to know that a financial planner is acting in their best interests," he said. "When you have commissions, that is simply impossible."
Mr Bowen's comments follow a parliamentary committee inquiry into the collapse of Storm Financial last year.
Storm's folding, and that of Opes Prime in 2008, prompted the federal corporations and financial services committee to investigate the role of financial advisers, the regulatory regime and the potential for commissions to create conflicts of interest.
Mr Bowen would like to see legislation cracking down on financial advisers passed by parliament this year, although he said that might be hard given a forthcoming federal election.
The new laws aren't due to take effect until July 1, 2012.
