1 Comment 1 Commentby Susan Edmunds
The Ministry of Business, Innovation and Employment has made public the 164 submissions it received on the Financial Advisers Act review issues paper.
There are a number of themes that stand out. One is the complexity of the current regime, which divides advisers up into registered (RFA), authorised (AFA) and qualifying financial entity (QFE) advisers.
Many submissions want the distinctions dropped.
AMP said the same standards should be applied to all advisers, and product class distinctions removed.
It suggested replacing the current delineation between class and personalised advice with a sales versus advice model.
Westpac said "RFA" did not convey what advisers did. "The general public believes the term RFA means the holder has completed education or gained experience... however this term simply means the holder has passed a credit check, is a member of an approved disputes resolution scheme and is registered on the Financial Services Providers Register."
ANZ said many of its customers were frustrated when they wanted advice about a particular product but staff could not give it.
It argued all financial advice should be personalised and a separate category should be set up for product sales and advice
BNZ said RFAs should have the same requirements as other advisers. It also wants a degree qualification requirement for AFAs.
Dealer group Kepa said the AFA/RFA system had not served advisers or customers well. It wants all advisers to be AFAs.
Former Institute of Financial Advisers president Nigel Tate said consumers would think of an RFA in the same way they considered a registered medical practitioner. "All financial advisers, including QFE advisers, should be required to adhere to the same code of professional conduct."
BNZ said the regime had failed to target investment advice services, which was where the original harm happened. "This has resulted in a regime that limits the conversations that customers ought to be having with people involved in the provision of mainstream financial products," it said.
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