FMA needs more money

The Ministry of Business, Innovation and Employment has released a discussion document as part of a review of the regulator's funding.

It said the FMA was coming under increased pressure as its remit grew and was forecasting a deficit of $4 million in the year 2019/2020, in part because of the work required to develop the new financial advice regime.

"The new regime will require the FMA to license a large number of entities (estimated at approximately 2,300) and will increase the number of entities that are subject to the FMA’s supervision. Many of those who are expected to operate in the new regime will be subject to licensing and monitoring by the FMA for the first time and thus will require more intensive engagement from the FMA. The FMA’s view is that significant work is required of it to assist the sector to understand and meet the requirements of the new regime.

"To date, the FMA has not received any additional funding to prepare for implementation of the new financial advice regime or the conduct and culture reviews. This has required the FMA to utilise existing cash reserves and divert resources from other areas including, in some cases, reducing or deferring usual monitoring activities of some regulated populations."