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: Friday, May 20th, 6:17PM

News

rss
Latest Headlines

Life insurance adviser's warning 'a message'

The Financial Markets Authority may be trying to send a message to the industry by making public some of the details of a warning delivered to an insurance adviser.

Friday, August 19th 2016, 6:00AM 3 Comments

by Susan Edmunds

The adviser, who has not been named, was found to have engaged in misleading or deceptive conduct.

He advised his clients of an alternative life cover plan with a different insurance provider but did not tell them about the policy pricing. He then provided a direct debit form to the clients, which they ignored.

He completed and submitted the direct debit form on his clients’ behalf, without authority, and completed and submitted a declaration of good health on his clients’ behalf without authority.

The FMA said the right response to the adviser’s actions was a warning.

He had voluntarily deregistered from the Financial Service Providers Register, left the industry and was no threat to future or existing clients.

The regulator said he made no financial gain and the clients suffered no monetary loss, and remain insured.

Former FMA staffer and now compliance consultant Gavin Austin said while it was not the first action the FMA had taken against an RFA, the fact that they had made it public might show that they wanted to make it clear that they were keeping an eye on advisers who are not authorised, too.

The FMA has fewer powers to act against RFAs than it has when it needs to deal with AFAs, who can be sent to the Financial Advisers Disciplinary Committee.

“The FMA might have wanted to say ‘we are doing something in that space’,” he said. “Because they are sometimes accused a lot of not doing enough.”

Sue Brown, a financial regulatory expert at DLA Piper, said the move probably showed a sharpening of the FMA’s appetite to take action against RFAs.

“They don’t have the same powers in relation to RFAs as they have with AFAs so to that extent it’s a good they have found a way to take action in a case where they thought it was necessary."

She said, had the adviser remained in the industry, the FMA might have made his name and business public to warn other clients.

Another compliance expert, Barry Read, said it was a relatively blatant breach.

He said it was possible that the warned adviser could choose to reregister on the FSPR in future, because the rules as they currently stand only require a police check and for the person registering to be part of an external disputes resolution scheme. But he said that was likely to change under the new version of the Financial Advisers Act.

Tags: financial advisers FMA

« New levies final nail for independent DIMS providersLVR restrictions to be reviewed »

Special Offers

Comments from our readers

On 19 August 2016 at 9:05 am smitty said:
Is it just me or is "He completed and submitted the direct debit form on his clients’ behalf, without authority, and completed and submitted a declaration of good health on his clients’ behalf without authority” in effect fraud?
Kudos for releasing details of this, but all I am left with is why hasn’t the FMA given this to the Police for further investigation.
I must say it is rather coincidental the timing of this “warning” after the release of their paper into commissions within the insurance sector.
On 19 August 2016 at 12:13 pm LPL said:
smitty, no it isn't just you ....
On 20 August 2016 at 3:01 pm I was wondering said:
Yes Fraud for sure!

Sign In to add your comment

 

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 5.35 4.49 5.25 5.55
ANZ 5.54 5.15 5.85 6.15
ANZ Blueprint to Build 2.78 - - -
ANZ Special - 4.55 5.25 5.55
ASB Bank 5.35 4.49 5.25 5.55
Avanti Finance 5.45 - - -
Basecorp Finance 6.45 - - -
Bluestone 5.29 7.49 7.59 -
BNZ - Classic - 4.55 5.25 5.45
BNZ - Mortgage One 5.55 - - -
BNZ - Rapid Repay 5.55 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Std, FlyBuys 5.55 5.35 5.94 5.99
BNZ - TotalMoney 5.55 - - -
CFML Loans ▲6.45 - - -
China Construction Bank 5.50 5.40 6.14 6.40
China Construction Bank Special - 4.45 5.19 5.45
Credit Union Auckland 5.95 - - -
First Credit Union Special 5.85 4.70 5.20 -
Heartland Bank - Online 4.00 3.85 4.70 4.84
Heretaunga Building Society 5.95 4.80 5.50 -
HSBC Premier 5.49 4.39 5.15 5.39
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 5.25 ▲4.29 ▲5.09 ▲5.35
Kainga Ora 5.43 4.57 5.58 5.85
Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 5.00 5.55 6.19 6.39
Kiwibank - Offset 5.00 - - -
Kiwibank Special 5.00 4.55 5.19 5.39
Liberty 4.84 - - -
Nelson Building Society 5.95 4.95 5.85 -
Pepper Essential 3.44 - - -
Resimac 4.59 5.60 6.16 6.29
Lender Flt 1yr 2yr 3yr
SBS Bank 5.29 4.69 5.35 5.49
SBS Bank Special - 4.19 4.85 4.99
Select Home Loans 4.09 4.29 4.86 5.09
The Co-operative Bank - First Home Special - ▲4.19 - -
The Co-operative Bank - Owner Occ 5.45 ▲4.29 5.19 5.45
The Co-operative Bank - Standard 5.45 ▲4.79 5.69 5.95
TSB Bank 5.59 ▼5.14 ▼5.79 6.15
TSB Special 4.79 ▼4.34 ▼4.99 5.35
Unity 5.65 4.80 5.50 -
Wairarapa Building Society 5.24 4.55 5.20 -
Westpac 5.54 5.09 5.79 6.09
Lender Flt 1yr 2yr 3yr
Westpac - Offset 5.54 - - -
Westpac Special - 4.49 5.19 5.49
Median 5.45 4.55 5.25 5.52

Last updated: 19 May 2022 10:42am

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