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Review terms get cautious welcome

Wednesday 4th of March 2015

They were revealed yesterday, outlining an 18-month process that will start with MBIE working to understand the role of financial advice and financial service provider registration and dispute resolution in improving financial outcomes for New Zealand.

“Our analysis will include consideration of changes to the regulatory environment, to consumer needs and expectations and to government priorities. This understanding will help us to test and update the objectives of, and rationale for, government intervention in this area. Current regulatory settings will then be considered in light of this intervention logic in order to identify key issues for consideration,” MBIE said.

Barry Read, of compliance firm IDS, said the terms of reference and the scope of the review were wide enough that the most common issues that popped up would have the opportunity to be analysed and assessed. He said he also liked the idea that MBIE would be updating their understanding of the role of regulation in the sector.

Adviser Murray Weatherston said the terms of reference were unsurprising.

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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.
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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.
4 days ago Jon-Paul Hale
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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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