Mayhew and the malcontented Seven
David Mayhew, the outgoing Commissioner for Financial Advisers, has completed his final statutory duty as chair of the Financial Advisers Disciplinary Committee, chairing its first meeting where the committee approved its rules and procedures.
Thursday, April 28th 2011, 7:41AM
by Benn Bathgate
The Committee was appointed by the Minister of Commerce to conduct disciplinary proceedings arising from complaints about alleged breaches of the Code of Professional Conduct by Authorised Financial Advisers (AFAs).
To date the Securities Commission has revealed seven complaints have been lodged, though none have been referred to the Committee.
The Commission said the bulk of the complaints have related to whether advisers were appropriately licensed.
"In those cases when we assessed them, the advisers had been registered - and since they don't need to be AFAs until July 1 there is no issue at this point," Securities Commission communications adviser Rebecca Barclay said.
She said one complaint - relating to definitions of wholesale clients - resulted in "a stern letter from us to the company involved."
Mayhew said authorised advisers were now subject to obligations under the Financial Advisers Act and the Code of Professional Conduct, therefore, "It is important the Disciplinary Committee is ready to receive any complaints referred by the Securities Commission."
Penalties for breaches include a fine of up to $10,000, cancellation of authorisation, suspension and censure.
Investors who have concerns about the behaviour of their financial adviser have been able to complain to the Commission since December 1, 2010.
Where the Commission believes, in the wake of an investigation, there has been a breach of the Code it will refer the complaint to the Disciplinary Committee.
The rules and procedures will be available on the Disciplinary Committee's website which is set to launch after the Financial Markets authority begins operations on May 1, 2011.
The disciplinary Committee also agreed at the meeting that Hon Sir Bruce Robertson would act as interim chair of the committee pending the appointment of a new chair by the Minister of Commerce.
Mayhew finished his role as Commissioner for Financial Advisers and Member of the Securities Commission on April 30.
David Mayhew, the outgoing Commissioner for Financial Advisers, has completed his final statutory duty as chair of the Financial Advisers Disciplinary Committee, chairing its first meeting where the committee approved its rules and procedures.
Benn Bathgate is a business reporter for ASSET and Good Returns, email story ideas to benn@goodreturns.co.nz
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