Where are the regulators when you need them?
There are some things I don't get about the newly regulated world at the moment. One is the story we ran yesterday where to advisers with dishonesty convictions recently in Australia are allowed to be registered advisers.
Tuesday, September 6th 2011, 7:41PM 13 Comments
We are still trying to get to the bottom of this and will report in again when we know where regulators sit on this.
Meanwhile the organisation they worked for reference checked them using Google and was happy with what he found.
I plugged their names into the search engine and the top results were ones which would make anyone wary about employing these people in a role like this.
The second is a speech Simon Power made a little while ago at the loan sharks conference.
While we didn't attend the conference there was some interesting research which showed how many low income earners were being ripped off by loan sharks.
The stories are truly ones of woe. Ones where unscrupulous operators prey on the vulnerable.
These are people who are being ripped off daily. These are people who are having their lives ruined.
If there was an area of financial services which needed cleaning up it is the loan sharks. It's not the financial planners and fund managers.
Yet, Power disclosed that between 35 and 40% of third-tier lenders are not on the Financial Service Providers Register, as they are required to be by law.
It is disgraceful that the good end of the financial services market is being maligned and put through significant regulatory hoops and hurdles, but this crowd isn't. Yet the government knows they are out there breaking the law.
Here's what Power said: "It's clear to me that this fast-growing industry fuelled by advertising focused on ease, speed, and normality of third-tier loans all aimed at those on low incomes and beneficiaries is a recipe for, if not disaster, then danger.
"Add in the fact that sole lenders are not complying with regulations and do not belong to a dispute resolution scheme and you know we have a lot of work to do.
"I know that the Registrar of Financial Service Providers is taking a keen interest in this aspect," Power said
Surely more than a keen interest (and a gabfest) is required here.
You can read Philip's blog here: http://www.goodreturns.co.nz/blog/
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