Ross collapse sparks wholesale debate
An exemption in the Financial Advisers Act allows advisers with clients who are deemed to be “wholesale” investors to operate without having to become Authorised Financial Advisers (AFAs).
There are a number of different types of clients who are considered “wholesale” rather than retail under the Financial Advisers Act, including those with net assets of $2 million or more or annual gross income of $200,000 or more for each of the last two financial years.
There are also "eligible investors" who must certify they have “sufficient knowledge, skills or experience in financial matters to assess the value and risks of financial products and the merits of those services”.
Angus Dale-Jones of Knax Consulting said the Financial Markets Conduct Bill, which recently passed its second reading, had slightly tighter requirements around eligible investor status and some increased financial thresholds.
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