AFA Monitoring & Registration Spot Checks Kick Off

This week we’ll be asking some Authorised Financial Advisers to submit their Adviser Business Statement (ABS). We will select a small number of AFAs from across the country (excluding the Canterbury region) and they’ll have seven working days to get their ABS to us. We will then review the ABS to check the systems and procedures it describes help ensure the adviser is conducting their business in a professional and compliant way. In particular we will be looking for information that describes the advice process they have in place. In some cases we may contact the adviser to clarify points or ask for additional information. We expect to provide feedback to individuals within 15 working days. The possible outcomes include: • No further review is required at this stage. • Further information may be required to help us understand the adviser’s approach. We may or may not ask the adviser to submit a revised ABS it to us once changes have been made. • A formal interview by phone. • A visit to the adviser to review their services and the outcome for customers and to ensure they’re operating in accordance with their ABS. Advisers in this situation will be provided with further details about what to expect from a visit. This is an excellent opportunity for advisers selected to receive feedback on their ABS. If there are themes for ABS improvement that emerge after the first few months of reviews, we are likely to issue hints and tips to all AFAs. Going forward, we may contact the adviser again at any time. In addition to periodic checks, we may respond to information received about their business, or investigate a particular theme across the industry. We may also conduct short surveys on a particular topic. Monitoring reviews will help encourage high standards of professionalism in the industry. If we do encounter a problem we will generally work directly with the adviser to help them meet the required standard. However we may also take action when standards fall below the required level. By the way, in addition to calling for some adviser ABSs, we are running some spot checks on advisers to ensure they are registered. Mel Hewitson Director Financial Adviser Regulation