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May 02, 2023
FMA Update
Treating bank consumers fairly - creating the right incentives
Bank chief executives have been written to by the FMA asking them to reconfirm changes to staff incentive schemes and reflect on how these are aligned with fair treatment outcomes for consumers.
This comes after reports of the reintroduction of sales targets, said Clare Bolingford, Executive Director, Regulatory Delivery. "Sales targets have the potential to increase the risk of conflicted conduct and mis-selling. We expect banks to design and manage incentive structures in a way that sustains fair consumer outcomes” she said.
'5 mins with the FMA' podcast: new financial advice regime
In our latest podcast we hear from FMA Director of Deposit Taking, Insurance and Advice, Michael Hewes about changes to New Zealand's financial advice regime.
The value of quality financial advice is particularly relevant in the current environment, when many New Zealanders are navigating challenging financial decisions.
Listen here.
Preparing for CoFI licensing
With Conduct of Financial Institution (CoFI) licensing opening on 25 July, the FMA is encouraging institutions to begin preparing to comply with the requirements under the CoFI regime if they haven’t already started.
At the outset it’s important for institutions to understand what’s required and to work on their fair conduct programmes (FCPs) as a necessary part of fulfilling the licensing requirements.
Regulatory returns for Financial Advice Providers
The FMA will be holding online sessions to provide an in-depth view of the questions that will be asked in the annual FAP Regulatory Returns.
Two sessions will be held in May and one session in June.
FAPs will be required to complete a regulatory return annually for the period 1 July to 30 June and submit it to the FMA by 30 September online via our website.
The first regulatory returns will be due by 30 September 2024, for the period 1 July 2023 to 30 June 2024.
Breach of market manipulation prohibitions and disclosure obligations
Wei (Walker) Zhong and Lei (Regina) Ding were found to have contravened the Financial Markets Conduct Act in relation to the trading of Oceania Natural Limited (ONL) shares.
In 2019 the FMA issued civil pecuniary penalty proceedings in the Auckland High Court against four people in relation to trading of ONL shares.
Justice Michael Robinson said he was satisfied that Zhong, the executive chairman and chief executive of ONL, and/or Ding, the sales and marketing manager and marketing director, contravened all seven market manipulation causes of action brought against them.
A hearing will be held at a later date to decide on the level of penalties for Zhong and Ding.
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