The Financial Planning Association of Australia sought to keep the identity of a member facing disciplinary action, Sam Henderson, out of the banking royal commission to protect his reputation.
The FPA claims to have strict codes of conduct and robust disciplinary processes.
Mr Henderson has been facing disciplinary action by the FPA for the past year after he gave advice that would have wiped $500,000 from a client's superannuation benefit.
But it emerged on Thursday that the FPA may have been more preoccupied with preserving Mr Henderson's reputation and staying on good terms with members.
John Bacon, the head of professionalism at the FPA, wrote to the royal commission on April 28 to ask that Mr Henderson's matter be "treated confidentially".
Publication could "cause significant damage to the reputation of Mr Henderson and "damage the FPA's relationship with other members", he wrote.
Mr Bacon was also concerned that naming Mr Henderson would render the FPA's disciplinary process "worthless".
This is because, unlike organisations representing doctors and lawyers, for example, there is nothing to compel FPA members to participate in the disciplinary process or to abide by any sanctions imposed.
The royal commission is examining the disciplinary powers and processes of peak industry bodies, the Financial Planning Association of Australia and Association of Financial Advisers.
Appearing at the banking royal commission on Thursday, Dante De Gori, chief executive of the FPA agreed the organisation's greatest "leverage" was to be able to name publicly the outcomes of disciplinary proceedings and sanctions.
Yet in many cases where investigations result in adverse findings, the names are kept confidential. Of 18 recent determinations, seven names have been kept confidential.
"I am not aware of why those have not been published," Mr De Gori said.
Australia has about 20,000 financial planners and more than half are FPA members.
The FPA operates on the $8 million it receives in membership fees each year.
Since January 1, 2013, the FPA has expelled six members.
The FPA investigation into Mr Henderson found that "in all circumstances there is a strong and reasonable inference that the member's conduct stemmed from a lack of objectivity or a conscious decision to place his own interests before the client ..."
The commission heard the FPA was very keen to come to a negotiated outcome with Mr Henderson, which meant his name would not be published.
Mr Henderson has a strong media profile, including a television show on Sky News and contributing general superannuation advice in AFR Weekend.
He has been dumped by both.
The commission also heard how the budget for the salaries of Mr De Gori and one other staff member, plus a staff bonus pool, is $1 million. That's about what the FPA spends on professional standards.
AFA chief executive Philip Kewin also appeared before the commission.
He said since 2013, the AFA had received 15 complaints about its members.
But in the case of Darren Tindall, who was banned from giving advice by the Australian Securities and Investments Commission for five years in February 2017 and expelled and fined by the FPA, the AFA had so far declined to terminate his membership, the commission heard.
The AFA found Mr Tindall, of Orange in NSW, should be suspended rather than terminated because the allegations about him amounted to "hearsay" and an appeal was on foot.
By Joanna Mathers
26 April 2018