Consumers told to expect clarity on commissions
New guidelines from the Financial Markets Authority that tell consumers what they should expect of their financial service providers are mixing up advisers and providers’ representatives, the IFA’s chief executive says.
Wednesday, March 1st 2017, 5:59AM
by Susan Edmunds
The FMA published a series of pointers it said consumers should use when dealing with providers including advisers, KiwiSaver providers and peer-to-peer lenders.
It said consumers were entitled to competence, to be treated honestly and fairly, to be informed, to know how much they were paying and to have problems and complaints dealt with properly.
“Customers should expect to be told about any conflicts of interest or commissions received through the sale of a product. Fees should be clearly set out, and providers should be willing and able to explain why they are reasonable,” the FMA said.
It said if there were limits to what could be offered, that should be made clear.
IFA chief executive Fred Dodds said it was potentially confusing that the written communication from the FMA referred to advisers, but the animated version talked about “staff” doing the right thing in regards to care, diligence, skill and the limitations of their advice.
“Again they are mixing up the audiences, which in my opinion are still chalk and cheese with the financial adviser and financial adviser representative [designations laid out in the Financial Services Legislation Amendment Bill].”
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