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[Weekly Wrap] Rules and more rules

We started this week by asking a question that has been floating around for a while now - could dealer groups step in as a step in the regulation process?

Friday, June 14th 2013, 12:39PM 1 Comment

by Susan Edmunds

The idea is that dealer groups could monitor their members in a similar way to the system used by QFEs.

The response to the idea was mixed. While Camelot's Peter Cave told me he was already thinking something along those lines, David Whyte said - and I'm paraphrasing here - that dealer groups weren't really up to the job. The comments section on this story has been running hot all week. I put the question to the FMA itself but so far have not had a response.

Then, the FMA issued a warning that people would need to be on their toes about AML pretty much right from the beginning. It's only a matter of weeks now until the new legislation takes effect. Unlike the introduction of the FAA regulations, this time there's going to be a lot less hand-holding from the FMA and a lot more action. The FMA said those who hadn't been audited would be the first to come under its watchful eye.

Speaking of rules and regulations, the tax laws around foreign superannuation schemes had apparently become so complex and confusing that some people could not understand whether they were actually meant to pay any tax at all. The good news for advisers dealing with people bringing large superannuation schemes to New Zealand is that there are moves to clarify what tax they must pay.

And yesterday David Ross was charged with false accounting and theft by a person in a special relationship. That prompted the FMA to give a warning to advisers offering DIMS that a guidance will be issued. I've noticed that a lot of the mainstream media coverage of Ross has repeatedly referred to him as a "financial adviser", which is unfortunate for the rest of the industry considering he seems to have had an easier ride than some to AFA status, by virtue of his being an accountant.

In other news, there's another US fund manager coming to New Zealand, high-yielding equities are still a good option for retirement income, even if interest rates rise, and KiwiSaver schemes are pondering whether they can open up the accounts of people who are bankrupted.

On our people news page, the Retirement Commission and Newpark have made appointments.

« Equity income still fine strategyIFA working on pro-bono offering »

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Comments from our readers

On 14 June 2013 at 2:11 pm David Whyte said:
The observation stands as paraphrased, although I accept that all Dealer Groups are not the same. Some are making genuine efforts to add value - others are just cash cows for the founders. The concept of the Recognised Professional Body (RPB) was abandoned in the UK in the early days of regulation. To suggest that a Dealer Group (which depends on aggregated premium income to generate over-ride commission for its very existence) will censure and discard an errant member is a real stretch. Of course, if the over-ride is persistency-linked, they might be more attentive. But it's also unfair on those Groups which are genuinely seeking to build long-term sustainable enterprises. Self-regulation - like an industry-wide maximum commissions agreement - is a myth. Leave the implementation of regulations to the regulators. If they're inadequately resourced, let them raise the issue with their masters.

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AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.14 6.75 6.39
ANZ 8.64 ▼7.45 ▼7.09 ▼6.95
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - ▼6.85 ▼6.49 ▼6.35
ASB Bank 8.64 7.14 6.75 6.39
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
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BNZ - Classic - 7.14 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 7.74 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 - 6.79 - -
Co-operative Bank - Owner Occ 8.40 6.99 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.49 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 6.89 6.55 6.35
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 6.69 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.74 7.35 6.99
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 7.99 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 6.99 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
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Pepper Money Advantage 10.49 - - -
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SBS Bank 8.74 7.74 7.09 6.95
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SBS Bank Special - 7.14 6.49 6.35
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.14 - -
SBS FirstHome Combo - - - -
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Select Home Loans 9.24 - - -
TSB Bank 9.44 7.79 7.55 7.45
TSB Special 8.64 6.99 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - 6.55 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
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Westpac Special - 6.89 6.75 6.39
Median 8.64 7.14 6.82 6.65

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