Your Guide to the FAA Review
Russell Hutchinson's guide on how to have a real input into the Financial Advisers Act Review.
Friday, October 24th 2014, 9:32AM
Do you want to have some real input into the Financial Advisers Act Review? I know there is a lot of interest in this Review just from looking at the comments and recent articles on this website: such as Dr. Michael Naylor on the label “restricted.” Or the comments from the Chapman Tripp review notes.
Some of the comments are really interesting, some are fun, or even mischievous, a few others are simply misinformed. But comments on this site are great (I’ve read a lot, they are interesting) but they simply won’t cut it if you want to have some input, to do that, you need to do this:
- Read the current law. You simply cannot avoid reading the current Act and amendments. No matter what you think you know you cannot properly debate unless you have read it, probably more than once. Fortunately it is easy and free. Go to this link and help yourself.
- Get other points of view. Read around the subject. Google the law, and read, for example what the Consumer’s Institute says about the law, what the IFA thinks, what Chapman Tripp said in their note, read the feeds on the FMA website – note in their statement of intent the areas they say they will be working on. Look at the related regulatory work going on right now. Read the views of your opponents.
- Be realistic. You will not successfully lobby to have banks banned from selling insurance, for example, so don’t waste your time. If you think that, for example, commission offers reasonable value to consumers and allows people better advice than they would get if there were no commission paid to advisers, then that’s a reasonable point of view to lobby for. Think about customers. How does your point of view help them, protect them, and give them better outcomes? Ultimately the review recommendations will be decided on by politicians. They are thinking about voters and what the opposition will say about the positions they take.
- Talk to your industry body. Phone up and talk about the areas that interest you, treat your first few calls as fact finding and discussion to help work on your contribution to the debate before you move into lobbying mode. Then write, send it electronically, but write professionally so your contribution can be shared and passed on by those that read it.
- Participate in the process. Note this background given by Chapman Tripp in their note on the review: “The Financial Advisers Act 2008 had a difficult birth, requiring several Supplementary Order Papers and a highly unusual eleventh hour “Pre-Implementation Adjustments Bill”. Partly in acknowledgement of the risks implicit in such a process, a clause was inserted into the Act promising a review by the Ministry of Business, Innovation and Employment (MBIE) within five years of the Act’s commencement. MBIE plans to initiate public consultation on this next year for completion before 1 July 2016. This is an important chance to drive change in those parts of the FAA regime which have caused confusion or frustration. We will be engaging fully in the review and urge you to do likewise.”
That last sentence is a good formula. I intend to follow it and it would be good if you do too. You can have input, but only if you participate in the process.
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