About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds Other Sites:   tmmonline.nz  |   landlords.co.nz
Last Article Uploaded: Monday, September 16th, 9:30PM
rss
Latest Headlines

Code: That's all?

Financial Advice New Zealand is among voices critical of the long-awaited new code of conduct for financial advisers.

Thursday, May 9th 2019, 6:00AM 5 Comments

More than a year after the Code Working Group was first convened, the final code was signed off by Commerce Minister Kris Faafoi on Tuesday.

The final code was a much simplified version of that consulted on through the working group’s development process – particularly compared to its first consultation.

There are just nine, high-level, standards.

Katrina Shanks, chief executive of Financial Advice NZ, said it was disappointing the code did not require a minimum standard for everyone providing regulated financial advice.

It also still allows nominated representatives to rely on their providers' processes to demonstrate they have the met competence standards.

“A key objective of the new regime is to build public confidence and trust in the financial services sector: ensuring that New Zealanders deal with qualified people is an absolutely crucial component in this,” Shanks said.

“The final code will set up a two-tiered system of advisers: a mandatory qualification for ‘individual’ financial advisers, and ‘equivalence’ for nominated representatives. In our view, this does not best serve New Zealanders.”

She said she was also disappointed at the lack of clarity around CPD requirements.

There had been calls for the code to introduce a minimum number of hours required of CPD each year.

Shanks said a commitment to CPD was a cornerstone of professionalism.

Adviser Murray Weatherston said he was delighted that the code had lost its “apple pie and motherhood” aspects. Including the requirement to “do the right thing” by clients.

Such sentiments would have been unworkable in an advice business, he said.

But he said what was left was underwhelming.

“At the end of the day what we’re left with isn’t every much.”

He said he expected gaps to be filled with a series of guidance notes from the Financial Markets Authority.  “In its simplicity it doesn’t have much guts. It’s the sort of thing that someone might have been able to sit down and write on the first day they met.”

Adviser Simon Hassan said the code left room for professional associations to impose their own standards on members.

Partners Life managing director Naomi Ballantyne said the code was “light” and it was disappointing that there was no particular focus on replacement business. She said attempts to tackle the issues through broader, less precise rules, had not been successful so far. “A code that doesn’t focus on that issue is too generic to be useful.”

She said she did not think the code added anything to the regulation that was already in existence.

Sovereign and AIA chief executive Nick Stanhope said it was a good principles-based approach to how advice should be given.

Tags: AIA Code Code Working Group Murray Weatherston Partners Life Simon Hassan

« New code: Shorter, sharper than draftPie seeks investment support for growth plans »

Special Offers

Comments from our readers

On 9 May 2019 at 10:15 am JeffQV said:
The phrase 'putting customers first' has been removed. No requirement for Level 5 and no structure for CPD. This is a retrograde step and will do nothing to add confidence to the consumer. Could and should have done better.
On 9 May 2019 at 11:38 am Tony Hall said:
Congratulations to Chris Fafoi for coming up with a practical Code that everybody can work with. The doom sayers were wrong and I think adviser numbers will hold up much better under this structure than if the mooted educational requirements had been implemented.

I note particularly that the door is open for Recognition of Prior Learning and many of the older advisers (including me) will be able to prove their competence without having to go back to school to learn how to do what we have been doing for the last 40 years.

The educational institutions will be devastated their gravy train may not leave the station.
On 9 May 2019 at 12:13 pm Murray Weatherston said:
CPD
Actually I don't see anything wrong with the CPD standard as it is writ.
It just says an individual must have a plan, reviewed at least once a year, with learning activities designed to ensure they remain up-to-date with (a) the regulations and (b) the CKS required for what they do.
So no restrictions on what does and does not count, and no quantity required.
It is over to each adviser to determine for themself.
While SIFA had submitted for a bit more detail, it was really as a "safe harbour" to protect our members from what will inevitably be fist fights with the regulator.
But that won't be a problem with the Standard.
That will be a problem caused by differing interpretations of what full freedom means.
Buy in the beer and popcorn.
On 9 May 2019 at 5:43 pm Murray Weatherston said:
@Tony Hall
I admire your RPL optimism.
I wouldn't pop the cork out of the champagne yet, as it is one thing to say RPL and I understand it is another to get it recognised.
I know one AFA who had to get a WASPish qualification (Australian actually) recognised for part of his AFA and while he eventually was granted recognition, the path was long tortuous and expensive. I think I remember him saying it would have been a lot cheaper to have just done the NZ course.
So while you rejoice the education institutions won't get your Level 5 Course money, they may just get it as they will be the people putting their hands up to do RPL.
My understanding is that a recognised assessor has to do a line by line comparison of what you have done in your PE/PL and what level 5 requires you to have done
In the past I have asked "who is BOTH competent to assess RPL AND "authorised" by the regulator to grant passes" and every time there has been stony silence.
Perhaps you could write a travelblog here on GR that describes your journey as you take it as an aid to others wanting to pursue that option.
Good luck.
On 10 May 2019 at 12:23 pm MAX62 said:
Excellent comments Tony Hall as a veteran adviser I am still trying to work out what we did wrong therefore what was broken!as you say this practical outcome is encouraging also love your comment about the gravy train could not have put it better !
As for Naomi's disappointment around "not addressing replacement business "I am stunned as she set a new standard for promoting this practice and I now hear rumors of $75k lump sum payments for becoming aligned with Partners please let me know if there is any substance to this and the increase in replacement business activity this will trigger.

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 4.15 4.09 4.49
ANZ Special - 3.65 3.59 3.99
ASB Bank 5.20 4.15 4.09 4.39
ASB Bank Special - 3.65 3.59 3.89
BNZ - Classic - 3.65 ▼3.54 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 6.15 4.95 4.95 -
Credit Union North 6.45 - - -
Credit Union South 6.45 - - -
Finance Direct - - - -
First Credit Union 5.85 - - -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 4.80 4.95 -
Housing NZ Corp 5.19 ▼4.15 ▼4.09 ▼4.39
HSBC Premier 5.24 3.35 3.35 3.35
Lender Flt 1yr 2yr 3yr
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 5.65 3.85 3.95 3.89
Kiwibank 5.80 4.30 4.34 4.74
Kiwibank - Capped - - - -
Kiwibank - Offset 5.15 - - -
Kiwibank Special - 3.55 3.59 3.99
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 5.70 4.69 4.79 -
Resimac 5.30 4.86 4.14 4.19
Lender Flt 1yr 2yr 3yr
RESIMAC Special - - - -
SBS Bank 5.29 4.85 5.05 5.49
SBS Bank Special - 3.69 3.69 3.99
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 3.65 3.59 3.99
The Co-operative Bank - Standard 5.15 4.15 4.09 4.49
TSB Bank 6.09 4.65 4.59 4.85
TSB Special 5.29 3.85 3.79 4.05
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.34 4.15 4.09 4.49
Lender Flt 1yr 2yr 3yr
Westpac - Offset 5.34 - - -
Westpac Special - 3.65 3.59 3.99
Median 5.35 4.15 4.09 4.19

Last updated: 16 September 2019 10:03am

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