Regulator seeks improvements from DIMS licence holders

The Financial Markets Authority monitors a sample group of the 49 providers licensed as Discretionary Investment Management Services - a licence which allows them to accept authority from investors to make buy and sell decisions on their behalf.

Its first monitoring report into the sector, which manages 47,000 retail accounts with $48 billion of funds under management, the FMA found providers overall were able to demonstrate how they put investors’ best interests at heart.

“Where a client allows another person to exercise discretion over investment decisions, it demands a high degree of trust and confidence, both in the people involved, and the processes and controls used,” said the regulator’s Director of Markets, Investors and Reporting, John Horner.

How well do investors understand what they are paying for?