100th full FAP licence issued
The Financial Markets Authority has issued its 100th full Financial Advice Provider licence.
Wednesday, October 20th 2021, 6:44AM
by Matthew Martin
First Capital Financial Services is the 100th financial advice provider to be granted a full licence by the FMA and says getting in early has given them the confidence they have solid systems in place for the future.
Managing director Hugh Percy says the company was granted a Class 2 Financial Advice Provider (FAP) licence and says there were two key reasons why they wanted to get the process completed early on.
"One, we didn’t want to run the risk that we might get caught up in the rush at some stage and have to wait. And two, we wanted to use the full licensing application process as a bit of a benchmarking exercise to test ourselves.
"We wanted to ensure that we had all the policies and procedures required under the new legislation locked down. Then, if there was a shortcoming or something that wasn’t right, we could put it right now."
First Capital Financial Services is the 100th financial advice provider to be granted a full licence by the FMA and says getting in early has given them the confidence they have solid systems in place for the future.First Capital Financial Services is privately owned and offers financial advice, specialist insurance and risk management, investment and portfolio management, UK pension and employee benefits advice, and have financial advisers in Auckland, Wellington, and Christchurch.
Percy says it also helped to crystalise some of their existing business procedural practices.
A Class 2 licence covers the service of a FAP (whether the licence holder or any authorised body) providing regulated financial advice to retail clients on the FAP's own account and/or through one or more financial advisers, but does not allow the licence holder or authorised bodies to engage nominated representatives.
Percy says the process was relatively simple and the company downloaded the application kit from the FMA website and worked through it methodically.
"We actually worked on it as a team to make sure we had multiple eyes across the whole thing and also because it gave the whole firm buy-in to the process and so they could see for themselves what we were doing."
He says in most cases they already had the majority of the requirements in place but they weren’t necessarily as good as they could be or they weren’t documented.
"So we just dealt with each issue as it came up, saved a draft of the application, and once we were satisfied that we could meet the requirements in a way that we could be proud of, we pushed the submit button," says Percy.
"I think some people are thinking they have to down tools and spend six months doing this but that’s not the case at all - it’s easily incorporated into your day-to-day activities."
He says he would encourage people to ask for help if they’re having problems.
"Don’t struggle through it or be apprehensive about getting some guidance or tips if there are parts that you’re not sure about.
"It shouldn’t be seen as an onerous undertaking, it’s about improving the way you run your business, the way you interact with your clients, and the overall outcome of that has got to be a good thing."
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