Thinking behind voluntary authorisation explained
However, the Ministry of Economic Development (MED) and Commerce Minister Simon Power make it clear in the Voluntary Authorisation Cabinet Paper that these risks are not significant and do not outweigh the benefits of implementing voluntary authorisation.
Cabinet agreed and last week it was announced that regulations are to be developed to allow voluntary authorisation under the Financial Advisers Act (FAA).
In the paper Power says there is a risk that voluntary authorisation may compel a number of category two advisers to become authorised to maintain their existing business.
"As greater numbers of insurance advisers and mortgage brokers become authorised, it is likely that there will be increased competitive pressures on the remaining parts of the sector to seek authorisation. This in turn will have the effect of creating a minimum standard for the industry."
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