Parliament will this week debate the latest of three pieces of legislation started under Labour aimed at ensuring that mum and dad investors will receive much better levels of advice from financial advisors.
Over the past few years, the collapse of many finance companies has resulted in the loss of millions of dollars of kiwi investors’ money, affecting thousands of people. Many mum and dad investors in Mana, paid for financial advice which in the end was not up to a professional standard.
The Financial Service Providers (Pre-Implementation Adjustments) Bill aims to help change that.
“Currently, anyone can call themselves a financial adviser as no qualifications are needed, no supervision is required and you don’t have to belong to a professional body, said Luamanuvao Winnie Laban, MP for Mana.
“Labour began amending this in 2008, passing two laws establishing the new financial advisers’ and service providers’ regime, and the latest legislation, a Government bill, ensures the regime is workable and effective.
Advisers will need to be registered by the Companies Office – part of the Ministry of Economic Development – and operate under a code of conduct, and they will also face disclosure requirements.
“Families in Mana who want to invest some of their savings through a finance company in order to improve their prospects, should at least expect that any advice they pay for to be professional and considered.
“This legislation is about protecting these people by ensuring they are provided with proper financial advice.
“Families in Mana want to get ahead, but require good and honest financial advice to help them understand the myriad of complex financial investments available.
“This series of legislation will help weed out the industry’s cowboys and start to build trust to ensure that families are not taken advantage of in the future” Winnie Laban said.
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