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Litigation is the big stick in a toolkit which includes warnings, enforceable undertakings, stop orders, licence revocation, and asset protection orders. What we reach for depends on the risk and harm we see, our regulatory objectives and other circumstances. Our regulatory response guidelines provide more detail on how we determine our response.
From an industry perspective, the ideal is prevention, and the best prevention is achieving good customer outcomes and demonstrating good conduct. This is achieved partly through formal governance systems and controls, and (mostly) through culture and behaviour. Look at the guide to our view of conduct for detail.
We accept that having the right attitude and doing the right things are no guarantee. Things go wrong. When that happens, we want to see people and firms owning their mistakes and working with us to resolve them. Get in touch with us sooner rather than later. Be open and transparent with us.
Our second annual conduct outcomes report – to be published in early 2018 – will outline what good conduct looks like, and our expectations in this area. It will contain case studies illustrating what we are seeing from our monitoring and supervisory ‘field work’. It will evaluate what consumers tell us about the conduct they’re experiencing from their financial services providers, and assess our own effectiveness in driving good conduct and market integrity.
Our 2017 conduct outcomes report can be viewed here.
Nick Kynoch, General Counsel, FMA
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