The debate follows a landmark court case involving PropertyTutors director Sean Wood being declined authorisation by the Financial Markets Authority, which determined he wasn't a person of good character after he failed to disclose convictions.

Institute of Financial Advisers president Nigel Tate said the good character test used by the FMA for would-be AFAs should be applied to all advisers, regardless of designation.

"If an individual is giving advice to members of the public that they need good conduct and should be subject to the appropriate person test," he said.

"The FMA has got strict rules as to how they do it but they only have the ability to do it for advisers who are applying to be authorised. I believe the FMA should have the authority to reject any adviser's application if there's appropriate grounds."

Tate noted that the fundamental requirements of the Financial Advisers Act - to operate with care, diligence and skill - are applicable to all advisers, whether registered or not.

However, AFA Murray Weatherston of Financial Focus said there was no need to rush into making changes to the current rules.

"The rules we've got now should be given time to bed in rather than people relitigating things they failed to get brought in last time."

People in the industry should accept "them's the rules" and give the new regime time to settle down, Weatherston said, adding that there don't appear to have been many "horror stories" so far.

"I think the important thing is the adviser who got turned down had their chance in court to get it overturned and the court didn't allow it."