FMA and Code at odds over adviser rules
Currently the Code Committee is consulting on proposed changes to the Code, and the FMA is seeking feedback on its draft guidance on how advisers should interpret the existing code.
Some advisers have questioned why the committee and FMA seem to be at odds, particularly over issues around how advisers demonstrate the basis of their advice, and whether that requires a full explanation of suitability.
FMA’s draft guidelines indicate that a full suitability explanation should be included each time. The committee, which says it recognises that some advisers feel bogged down in paperwork, says that is unnecessary.
Ireland told a consultation meeting in Auckland: “You do not need to provide 60 pages on every occasion, the idea is that you can tailor it to match the service that you are providing. We looked at the FMA guidance and added in the proposed clarification explaining the basis on which services provided does not extend to a suitability analysis.”
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