About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds Other Sites:   tmmonline.nz  |   landlords.co.nz
Last Article Uploaded: Friday, December 6th, 6:43PM
rss
Latest Headlines

Advisers told: Speak now if you want your voice heard

Advisers are concerned the working group that will develop the industry’s new code of conduct does not include a practitioner's voice – but want it to get on with its job of clearing up uncertainties about looming new rules.

Thursday, June 22nd 2017, 6:00AM 6 Comments

by Susan Edmunds

The code the group will develop will soon apply to all financial advisers – a population of more than 25,000 -  and will dictate things such as the qualifications they must have or the CPD requirements they have to meet. It is expected to have completed its initial work by next August.

It was revealed yesterday that the group will be chaired by Angus Dale-Jones, formerly of the Securities Commission and a PAA board member. John Berry, of Pathfinder, also features, and Shane Edmond, head of private client services at Shane Edmond, among others. 

The only adviser is Rebecca Vanderbom, an AFA who is head of financial advice delivery and service at Milford Asset Management.

Rod Severn, chief executive of the PAA, said it was disappointing that the group did not include a practising adviser. He said insurance was also under-served. 

Barry Read, of IDS, agreed it was surprising that there was not an adviser association represented on the board.  He said he would have expected an IFA investment expert or a PAA or IFA insurance expert to be appointed. It would mean advisers would have to engage in good consultation and lobbying.

“If they get it wrong it could have a big important.”

Read said it would be important the code was flexible and did not simply demand a six-step process and level five qualification for all advisers.

David Ireland, who is chair of the current code committee, has not been appointed to the working group but has been made a special adviser to the group.

He said the group had been appointed to develop the code, not to deliver financial advice.  “It’s now incumbent on financial advisers to engage with the process.”

He said the community of independent advisers would need to engage in the consultation process to have their voices heard and ensure that their experience was shared. “They’ll need to clearly communicate how the code could be structured to deliver optimum outcomes for consumers.”

Dale-Jones said there would be a big focus on engagement as the working group set about its work. It is yet to have its first meeting.

He acknowledged it was a challenging time for advisers, as the regulation changed.  But he said the group would want to “go beyond” consultation to have all stakeholders become part of its conversation. “I believe passionately in this part of the financial services world,. This is the touch point for financial services.”

Severn said the most important thing was that the group now get on with its work.

It has to fill in many of the gaps in the Financial Advisers Act review. Severn said it was important that the group developed the rules to provide advisers with clarity so that they knew what lay ahead.

“This has been going on for two years. These guys have to sort it out and I hope they do. They have a big job in front of them and I hope they get on to it.”

Ireland said it would be important that all stakeholders got behind the working group as it developed the new code.

“The quality of the outcome will be directly proportionate to the quality of the consultation process which relies on the quality of input. Hopefully people can leave their vested interests at the door.”

The Financial Services Legislation Amendment Bill, which delivers the new rules in which the code will work, is being submitted to the house next week.

Read said he hoped that eventually the industry would be able to engage in self-regulation.

Tags: Code Committee David Ireland IDS Rod Severn

« Public Trust to lose guaranteeLVR restrictions to be reviewed »

Special Offers

Comments from our readers

On 22 June 2017 at 8:15 am MPT Heretic said:
Engagement...consultation... what a load of rubbish. No practicing financial adviser is sitting at the head table.

So it is abundantly clear the Minister, MBIE and the FMA have no intention of meaningful engagement or consultation with independents.

They had the ability to have 11 members and couldn't find 1 worthy AFA?

But thats ok because apparently all you need for quality personalised advice is a keyboard, a screen and an animated animal
On 22 June 2017 at 8:30 am Charity said:
"He [David Ireland] said the group had been appointed to develop the code, not provide financial advice. 'It's now incumbent on financial advisers to engage with the process.'"

I wonder if Mr Ireland would feel the same if there were no lawyers appointed to develop regulations governing how lawyers practised law.

What an incredible thing for the head of the Code Committee to say!

There are so many things that someone who has never been a financial adviser is ignorant about--not only from an advisory perspective but from a business perspective. Perhaps we should have financial advisers start drafting the regulations about how lawyers practise law.
On 22 June 2017 at 9:39 am Brent Sheather said:
I started to write some comments on this but there is so much to write about I thought why waste the time. I will highlight two things however. Firstly, Barry Reid says if they get it wrong. Barry I don’t think there is any chance they will get it right (where right is the right thing for retail investors) given they largely represent the BEOT. Secondly, the fact that this sort of thing is going on and on and on and on simply illustrates the fact that previous efforts have largely got it wrong. Goodness knows the cost and where is the accountability?

The fact that NZ hasn’t got it right isn’t surprising given that many of the movers and shakers in government and the regulatory scene don’t seem to have or want to have any knowledge of best practice given that it threatens profitability and government is corrupted and captured by the BEOT. One imagines that the committee members here who seem to have no knowledge of the industry will be dominated by the ones that do. As an aside I was an expert witness in a case that was settled out of court in respect of a financial advisor who worked for one of the representatives of an organisation on this new Code group who will be determining the future of the industry. In my 30 odd years in this business I had never seen worse behaviour (client’s interests were not put first to put things mildly) and the really sad fact was the only reason the lawyers for the plaintiffs came to me is because they couldn’t find anyone else in the industry prepared to stand up to that firm. We won of course.

Similarly the new Code Committee is also dominated by the representatives of vertically integrated organisations selling products many of which are illegal in places like England and Europe where the regulatory authorities are doing the right thing for retail investors. So yes Barry it is inevitable they will get it wrong for retail investors but as has happened consistently in this long tedious period of re-regulation it will be the right thing for the BEOT.
On 22 June 2017 at 10:56 am w k said:
"Advisers told: Speak now if you want your voice heard" - really? our voices have all but gone hoarse.
On 22 June 2017 at 2:21 pm R1 said:
Why does the code working group not contain an independent, practicing AFA and competent, non-conflicted representative(s) of retail investors?

We all know why, and that is why the industry outside TBEOT is not particularly engaged. They see another BOHICA moment looming with the support of a captured government department and regulator. We feel angry, frustrated and helpless both as advisors and investors.

It really is shameful stuff and very costly to this country in the long run; particularly when the profits from TBEOT are repatriated overseas and NZ retail investors have less wealth in their retirement. Imagine the value to this country if the industry was truly required to put clients' interests first using the common meaning of the term.
On 23 June 2017 at 8:37 am dcwhyte said:
Point of order- there are not "25,000 financial advisers" in NZ. There may be that number of consumer-facing individuals, but they are not all financial advisers. Most of that number operate in QFE-land with the prime objective of selling products to meet the QFE's expectations and KPIs. The distinction is important for consumers to be aware of the different services on offer, and the regulatory regime should reflect this.

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Weekly Wrap

Previous News

MORE NEWS»

Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.19 4.05 ▲4.05 4.49
ANZ Special - 3.55 ▲3.55 3.99
ASB Bank 5.20 3.89 4.05 4.39
ASB Bank Special - 3.39 3.55 3.89
BNZ - Classic - 3.49 3.45 3.99
BNZ - Mortgage One 5.90 - - -
BNZ - Rapid Repay 5.35 - - -
BNZ - Std, FlyBuys 5.30 4.45 4.35 4.55
BNZ - TotalMoney 5.30 - - -
China Construction Bank 5.50 4.70 4.80 4.95
China Construction Bank Special - 3.19 3.19 3.19
Lender Flt 1yr 2yr 3yr
Credit Union Auckland 5.95 - - -
Credit Union Baywide ▼5.65 ▼4.75 ▼4.75 -
Credit Union North 6.45 - - -
Credit Union South ▼5.65 4.75 4.75 -
Finance Direct - - - -
First Credit Union 5.85 3.99 4.49 -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 4.80 4.95 -
HSBC Premier 5.24 3.54 3.54 3.69
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 5.15 3.18 3.18 3.20
Kainga Ora 5.18 4.04 3.95 4.39
Kiwibank 5.80 4.14 4.30 4.64
Kiwibank - Capped - - - -
Kiwibank - Offset 5.15 - - -
Kiwibank Special - 3.39 3.55 3.89
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 5.70 4.25 4.15 -
Pepper Money Near Prime 5.64 - 5.44 5.44
Lender Flt 1yr 2yr 3yr
Pepper Money Prime 5.18 - 4.98 4.98
Pepper Money Specialist 7.59 - 7.39 7.39
Resimac 4.50 4.86 3.89 3.94
RESIMAC Special - - - -
SBS Bank 5.29 4.85 5.05 5.49
SBS Bank Special - ▼3.39 3.45 3.89
Sovereign 5.30 4.15 4.29 4.55
Sovereign Special - 3.65 3.75 4.05
The Co-operative Bank - Owner Occ 5.15 3.49 3.59 3.89
The Co-operative Bank - Standard 5.15 3.99 4.09 4.39
TSB Bank 6.09 4.35 4.25 4.69
Lender Flt 1yr 2yr 3yr
TSB Special 5.29 3.55 3.45 3.89
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.34 4.15 4.09 4.49
Westpac - Offset 5.34 - - -
Westpac Special - 3.39 3.45 3.99
Median 5.34 4.04 4.09 4.39

Last updated: 4 December 2019 9:11am

News Quiz

The maximum remuneration model for Australian life insurance advisers is to be set at what?

Upfront 40% + trail 20%

Upfront 50% + trail 10%

Upfront 50% + trail 20%

Upfront 60% + trail 10%

Upfront 60% + trail 20%

MORE QUIZZES »

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