KiwiSaver selling practices investigated

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The Securities Commission is investigating complaints of illegal house-to-house marketing of KiwiSaver schemes.

Friday, September 4th 2009, 7:26AM 3 Comments

by Sonia Speedy

Under the Securities Act, house-to-house selling of securities is illegal unless they are life insurance contracts, Building Society or Co-operative securities. The Securities Commission uses the term house-to-house as oppose to door-to-door, as the restriction only refers to residential houses - distributors can go from business to business. Cold calling on the telephone is also permissible in New Zealand.

An Inland Revenue spokesperson said it had received calls expressing concerns about the way some KiwiSaver products were being marketed or distributed, such as house-to-house. While it was not able to comment on individual schemes or providers, it confirmed that it had passed some complaints onto the Securities Commission to look into.

Securities Commission general counsel Liam Mason confirmed it had been referred complaints around house-to-house KiwiSaver selling which it was currently investigating. He too was unable to provide further details of those involved and could not yet confirm a timeframe for the investigation.

NZF chief operating officer Adrienne Smith says that while it has not experienced any problems with its distributors, she had heard of concerns in the wider marketplace several months ago.

Smith says NZF ensures that training of its SuperKiwi scheme distributors emphasises that such selling methods are a "no-no" and had reiterated this message to them.

ING head of KiwiSaver distribution David Boyle says he has not seen or come across such practices himself and was "99.9%" sure it would not involve ING's distributors. However, he believed it was "pretty concerning" if the discussion around house-to-house selling was factual.

Huljich Wealth Management managing director Peter Huljich says none of its employees have carried out any door-to-door sales. It also has 614 people around the country who are not employees but who distribute its products, along with other financial service offerings.

"We don't actually have control over what they do, they're not employees, but if it can be proven they've gone door-to-door they are instantly terminated," he says..

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