With the new regime for financial advisers in New Zealand taking effect on March 16, 2023, the Financial Services Council (FSC) said that many advisers have yet to complete their licencing requirements.
To get more advisers on board, the FSC listed and debunked 10 popular myths about the new regime. Some of these myths include “If I keep ignoring the new requirements, it will all go away”; “I’ve never had a complaint and none of my clients would ever complain, so it won’t matter”; and “I am not worried as I can leave preparing to submit my full licence application in March 2023 – it’ll be okay.”
According to the FSC, advisers must not be complacent about these requirements, as these have a significant effect on their business and their compliance with regulations.
“We all work with many advisers daily, and it’s great to see that a large majority are prepared or are in the process of preparing for this change, which at the end of the day will improve financial advice for all New Zealanders,” said Trisha Edmonds, co-chair of the FSC’s professional advice committee. “Equally, however, it is worrying some of the feedback we hear from parts of the adviser community ranges from denial to misplaced confidence that they either don’t need to or will be able to meet the needs of the regime the day before the cut-off. This simply isn’t the case."
The FSC said that once the new regime takes effect, anyone who gives regulated financial advice to retail clients must have a full licence or be engaged by a licensed financial advice provider as a financial adviser or nominated representative. If not, they will be breaking the law.
“It’s not just about breaking the law, it’s the worry that clients may find themselves without the financial advice that they rely on after March 16, 2023,” said FSC chief executive Richard Klipin. “Financial advice is so important to Kiwis, and we hope that busting these myths will help encourage all financial advisers that haven’t yet to take the first step, to find out more and take action.”
