QFEs to get super powers

Investment Savings and Insurance Association chief executive Vance Arkinstall says that the Commerce Minister, Simon Power, had indicated the government would amend the Financial Advisers Act (FAA) to clarify the definition of 'agents' covered by QFEs.

Arkinstall said the FAA amendments would probably also extend the range of products QFE advisers were able to deal in. Under the original legislation, QFEs were only to be responsible for employees who sold products issued by the QFE itself.

"Under the current legislation QFEs were only to cover employees but we understand they will be able to include agents and financial advisers providing the organisation accepts responsibility for the actions of the advisers [under its control]," he said. "We expect there will be a broadening so QFE agents and advisers can sell products issued by other organisations."

Arkinstall said only institutions with strong balance sheets would be able to meet QFE standards as they would have to demonstrate the ability "to put things right" in the event of a successful consumer complaint.