Government suggests options to improve financial advice laws

Commerce and Consumer Affairs Minister Paul Goldsmith today released an options paper which sets out ways to improve our financial advice legislation.

“Our aim is to increase consumer confidence in financial advisers and the advice they give, so that people can make informed decisions about their money,” Mr Goldsmith says.

“We hope to make improvements to this regime so that all New Zealanders, including those with simple questions and without large sums to invest, have access to trusted financial advice should they want it. 

“We’ve heard, for example, that the current regime is overly complex and that this has reduced access to financial advice. Another complicating feature is that people don’t always know whether they are getting genuine advice or whether they are being sold a product, such as insurance or investments.

“Current rules around the disclosure of commissions and potential conflicts of interest are inconsistent. The options paper canvasses different approaches to achieve greater consistency across the board.

“This paper outlines options, ranging from minor changes to more fundamental reform, for simplifying the regime and addressing the issues that were identified in the initial consultation phase.

“I encourage the users and providers of financial advice, across all sectors of the advice industry, to give feedback so that we can get a regime that is workable for the industry and helps improve the financial wellbeing of all New Zealanders.

“One of the Government’s key priorities is to build a more competitive and productive economy that delivers higher incomes and living standards for New Zealanders. Sound financial advice and a professional financial advice industry are critical to this.

“These pieces of legislation are both integral to the effective functioning of New Zealand’s capital markets, one of the Government’s Business Growth Agenda goals,” Mr Goldsmith says.

For more information and to read the Options Paper see http://www.mbie.govt.nz/info-services/business/business-law/financial-advisers/review-financial-advisers-act-2008

Note to editor:

The Government is reviewing the Financial Advisers Act 2008 and the Financial Service Providers (Registration and Dispute Resolution) Act 2008.  The final report on the operation of both Acts will be provided to the Minister of Commerce and Consumer Affairs by 1 July 2016. This report will include any recommendations for changes arrived at after the options paper consultation process.