Rules set to get a lot tougher for many advisers

Jon-Paul Hale

What is happening with health and safety in terms of compliance action, will be what we in the financial advice sector, too, under the Financial Services Legislation Amendment Act.

The minister in charge of WorkSafe has said they are looking to step up the approach with H&S compliance, by issuing on-the-spot fines. Much of the noise there has been about threats of court action to drive compliance, that's all about to change.

And no for us, that's not scaremongering, if you bother to look at the FMA website. Under their "news and resources" section, you will see many different situations and reports: Investigations, court decisions, cases before the courts, and enforcement  zctions. FADC has had just 9 cases since 2013, and six were in 2013. There is more activity with cases before the courts than much of the rest combined.

Moreover, this is a lot to do with the limited number of AFAs and entities the FMA presently has jurisdiction over. You now add 25,000 advisers, current QFE and RFA advisers, that have to adhere to the new code, and you have opportunity to pursue a whole lot more people in a whole lot of new and different ways.