Reforms underway to address advisers’ performance

Published: Thu 5 Nov 2009 11:26 AM
News release
5 November 2009
Reforms underway to address financial advisers’ performance
Reforms underway will help address poor performance by financial advisers highlighted in the Consumer research released today, says the Commissioner for Financial Advisers, Annabel Cotton.
Consumer found most of the financial advisers surveyed gave poor advice and their advice lacked proper analysis of client needs and transparency in disclosing costs and interests.
“The findings are very disappointing but not surprising as the industry has been largely unregulated until now,” says Ms Cotton. “Investors must be able to trust the advice they get and that’s clearly not the case.”
“The Commission is working with other agencies and the industry to put in place a framework to make financial advisers more accountable. We expect to have this in place by the end of next year.”
The key changes include:
• Registration of financial advisers with the Companies Office with the register available to the public
• Financial advisers providing advice on investments such as shares, managed funds or futures, will have to be authorised by the Securities Commission
• Authorised financial advisers will be bound by a code of conduct setting minimum standards of competence, ethical behaviour and client care
• The Securities Commission will regulate the financial advice industry and monitor compliance with the Code of Conduct on an ongoing basis
• The Securities Commission will be able to take action to suspend or ban authorised financial advisers if they breach the Code of Conduct
• All financial advisers will have to belong to an approved dispute resolution scheme and there will be an established process for handling complaints.
“The aim is to build the professionalism and integrity of the industry so that investors can have confidence in the advice they get,” says Ms Cotton.
In the mean time she encourages investors to shop around. “Advisers must be able to understand investments they recommend and clearly answer any questions investors may have. Investors should make sure they are completely comfortable with any recommendations before committing to an investment.”
“Investors should also be aware that under existing law, financial advisers are required to provide clients with a written disclosure statement outlining their credentials, fees and any relevant interests before giving any advice.”
Further information is available at

Next in Business, Science, and Tech

New Year Border Exception For Seasonal Workers In The Horticulture And Wine Industries
By: New Zealand Government
Grey Power Is Disappointed To Learn Of More Bank Closures
By: Grey Power New Zealand
Supply Chain On Brink Of Overload Says National Road Carriers
By: National Road Carriers
Annual Goods Trade Surplus At 28-year High
By: Statistics New Zealand
How Real Is That Bargain?
By: Commerce Commission
Births And Deaths: Year Ended September 2020
By: Statistics New Zealand
Okay Boomer: Kākāpō Wins Bird Of The Year 2020
By: Forest And Bird
Govt Goes “hard And Early” On RSE Workers
By: ACT New Zealand
Bringing RSE Workers Back The Right Move
By: Business NZ
Cream Of The Crop Will Get To Market
By: Auckland Business Chamber
Horticulture Industry Appreciates Government’s Decision On RSE Workers
By: Horticulture NZ
BNZ Optimistic About Year Ahead
Māori Population Estimates: At 30 June 2020
By: Statistics New Zealand
View as: DESKTOP | MOBILE © Scoop Media