Whistle-blowers more exposed under new rules

Barrister Merran Keil, former senior legal counsel at the Financial Markets Authority, has pointed out that while the Financial Services Legislation Amendment Bill provides protection for financial advisers or nominated representatives who report breaches of the legislation to the FMA, it does not protect their identity in the same way as if the disclosure was made under the Protected Disclosures Act, or the Financial Advisers Act.

“During my time at FMA there were several occasions where an employee or ex-employee made disclosures to the FMA of acts that amounted to infringements of the law that the FMA regulates," she said. 

"In all cases the FMA did protect the identity of those Informants, however in one of those cases, it was obvious to the employer who the informant was because of the nature of the information the FMA had obtained. 

"This will probably be the case when the employer runs a small practice and the number of people that know about the infringing behavior is limited. Further the FMA will almost invariably withhold the release of information disclosing informants’ identities under the Official Information Act. But, my question is why the bill excludes the requirement that an Informant’s identity be kept secret, when that provision was included in the Financial Advisers Act?"