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Susan Edmunds
Susan Edmunds
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More time needed for new rules

Tuesday 23rd of May 2017

The release of the Financial Services Legislation Amendment Bill exposure draft outlined a timeline for the new regime. It was expected that the new Code of Conduct would be approved by August next year. The proposed new regime would take effect six months later, at the start of 2019.

Existing industry participants would have another two years to meet any new competence, knowledge and skill standards. In that time they would be able to carry on providing the services they were already able to provide.

It was also suggested that it could be possible for AFAs to be made exempt for five years from meeting the new competence, knoweldge and skill standards because they had already completed the level five certificate. Another option suggested was that AFAs and RFAs be allowed to demonstrate competence through  testing and client file reviews, if they had been working for 10 years.

But submitters on the draft raised concerns about the proposals. MBIE has made public their submissions.

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FMA outlines its latest expectations for advisers
Paul Flood: The danger is that the 'goalposts' (regarding what is acceptable or unacceptable adviser conduct) may be susceptible to change. Our 'Principles based' legal/regulatory environment lends itself to “prevalence-induced concept change” over time, perhaps not so much in the written laws and Code, as in the interpretation of the prescribed principles.
2 days ago Steve Wright
FMA outlines its latest expectations for advisers
Just a tip, if you use more than six, six letter words in a sentence you lose most Kiwi's. So avoid client/adviser confusion when writing your post or article if you would like it read and understood. Ironically, my last sentence was not likely read.
2 days ago Backstage
FMA outlines its latest expectations for advisers
All things said are great aspirational goals for a great financial advice industry, it mirrors what both the legislation and the code requires. However, like most things discussed it talks about what's expected not how it's done. The hardest aspect of financial advice today isn't what it is, it is how it is done. The how only comes from those that have done it, the how is only provided with examples. Guidance documents that spell out what's required along side how it it done. We’re still dealing with the same issues we started with in 2021, figuring out the how. And figuring out the how in every advice business is consuming resources that could easily be shortcut by the FMA demonstrating what they are expecting. It's not about “do it this way” its about this is the sorts of things we’re looking for. In the absence of standards and expectations, guesswork prevails. That represents significant risk to FAPs and the result is onerous overcooked advice processes for multiple advice operations and undercooked she’ll be right for single operators focused on getting the work done. Both approaches have potential for harm and as its been said earlier, leaves advisers open to explain they haven't been speeding with the authorities have pulled them over. The advice industry needs guidance on the how we know the what already.
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To correct errors in my previous post: "policies, templates, and controls" should read "policies, processes, systems and controls", and "is more conductive" should read "is more conducive".
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