tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Tuesday, April 16th, 6:28PM

News

rss
Latest Headlines

Independence redefined

The meaning of independent financial advice has been modified by the Advertising Standards Complaints Board.

Wednesday, October 18th 2000, 10:18PM

by Philip Macalister

If you thought you knew what an independent financial adviser was following a decision from the Advertising Standards Complaints Board (ASCB) three years ago think again.

In 1997 the board controversially ruled that Money Managers could not call itself independent because it received commissions from fund managers. Consequently, because managers pay most advisers some form of commission for selling their products the word independent was deleted from the industry's lexicon.

The board's definition of independence has stood because no-one in the industry has bothered to devise a better or more appropriate one.

Things have changed though thanks to Money Managers and the board.

Money Managers marketing director Al Scott complained to the board recently about an advertisement run in the New Zealand Herald by Financial Vision.

In the ad, and on its website, Financial Vision described itself as independent. Also, it said on its website that under its standard charging option the company is able to receive "any brokerage that is payable from the placement of any insurance or investments."

Scott concluded that this description was in breach of the earlier board decision.

Financial Vision argued because it used Sovereign's Aegis Portfolio Monitoring system, and charged monitoring fees on a purely fees basis it was in fact independent.

The board agreed saying that the portfolio monitoring service, "which was the basis of the complaint, was performed on a purely fee basis."

It said this was clearly distinguishable from the 1997 decision, therefore Financial Vision "was quite within its rights to make use of the word independent."

In dismissing the complaint the board said "where the advertiser can confirm there were no commissions, trailing commissions, soft dollar arrangements or benefits from product providers, which may tend to create a product bias then the use of the word independent was, in the board's view, permissible in financial advertising."

The board did however "emphasise that its use was strictly limited to those particular occasions where absolutely no remuneration was received from the fund manager for the service."

Besides defending itself Financial Vision, in its submission, also took a shot at the board saying its previous decision set a "stupid standard".

"We strongly disagree with the board's ruling on the use of the word independent. The word has a clear meaning in English and in effect, the board is prescribing a new and inaccurate definition of the word without good reason.

"It seems to us that a standard which purports to prevent me describing myself as independent when I am in fact independent...is a stupid standard which we would like to see changed," Financial Vision said.


Independence is a hot issue.


Who's right this time? Does the board's ruling make sense to you?
There's plenty more questions which need to be answered. Go to the Online Forums to read more questions and have your say.
TO GET THERE QUICKLY CLICK HERE
« Putting the case for techGet your tax questions answered online »

Special Offers

Commenting is closed

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Weekly Wrap

Previous News
Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.24 6.75 6.65
ANZ 8.64 7.84 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.24 6.79 6.65
ASB Bank 8.64 7.24 6.75 6.65
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
Basecorp Finance 9.60 - - -
Bluestone 9.24 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Classic - 7.24 6.79 6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 7.84 7.39 7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 7.04 - -
Co-operative Bank - Owner Occ 8.40 7.24 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.74 7.29 7.15
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.69 6.45 6.19
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.75 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.79 7.39 7.25
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 8.25 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 7.25 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.75 7.35 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 8.09 7.59 7.29
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 9.09 8.59 8.29
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.84 7.45 7.25
SBS Bank Special - 7.24 6.85 6.65
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.74 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 8.04 7.55 7.45
Lender Flt 1yr 2yr 3yr
TSB Special 8.64 7.24 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - - 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
Westpac 8.64 7.89 7.35 7.25
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.29 6.75 6.65
Median 8.64 7.29 7.32 6.65

Last updated: 8 April 2024 9:21am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox  |  Disclaimer
 
Site by Web Developer and eyelovedesign.com