Reserve dispute resolution scheme wants to be "independent"

• Tweet

The Institute of Financial Advisers is calling for the financial advice industry to have a voice in the ruling of disputes once the reserve dispute resolution scheme gets up and running.

Wednesday, April 21st 2010, 8:53PM 1 Comment

by Sonia Speedy

Ministry of Consumer Affairs consumer policy manager Evelyn Cole says the operation of the reserve scheme will be independent of industry members. This includes considering and ruling on disputes.

However, she says the establishment of an advisory board to help the Ministry and the reserve scheme provider in advising on the operation of the scheme is proposed and will be established later this year.

Institute of Financial Advisers president Lyn McMorran is adamant that people with relevant professional expertise in the industry should be included on the panel that rules on disputes.

"I don't know how many people they're planning on having on their panel, but I think there needs to be a voice for the industry at least," she says.

"...Somebody that understands the complexities of how you provide advice. What does good practice advice look like? They wouldn't have a clue," she says.

McMorran questions why anyone would join a scheme provided by a body that knows nothing about their industry.

"I'm quite sure that the lawyers' association disputes scheme have people who are actually lawyers (involved in) their disputes resolution disciplinary process. I'm quite sure that accountants do. I can't imagine any profession that wouldn't," she says.

McMorran is also critical of the level of consultation shown by the Ministry, saying that while other bodies have been very consultative with the industry, she had never been contacted by the Ministry of Consumer Affairs.

Cole says the reserve scheme rules should be finalised by mid-May and the provider finalised by the end of May to mid-June. However, the Ministry could not say how many applications had been made to provide the reserve scheme and from whom.

Dispute Resolution Services Ltd manager of client and business development, Paul King, confirmed it had put in an application for the role of reserve scheme provider. But he declined to comment further until a formal announcement was made as to who would run the scheme.

Aside from the reserve scheme, Cole says two applications have been received for approval as dispute resolution schemes for the industry. This includes Financial Services Complaints Limited and the Insurance and Savings Ombudsman Scheme. The Ministry has also been advised that an application will be forwarded by the Banking Ombudsman Scheme.

Comments from our readers

Commenting is closed