Financial Advisors Act

Stephen Franks blogs on the Bill of Rights Act and the Financial Advisors Act:

Last evening Doug Bailey and Dr Andrew Butler of Russell McVeagh presented to the National Party’s Blue-Libs a plea for the party to  upgrade what Andrew called “the Bill of Not Quite Rights” (the NZ Bill of Rights Act 1990). Among other recomendations Andrew urged strengthening the duty on the Attorney General to report on whether Bills before Parliament are inconsistent with NZBORA and a “forced response” from the government when there is an inconsistency,  requiring the government to say if and what it will do about  it.

Not a bad idea.

Among the Bills that desperately needed an adverse NZBORA opinion was what is now the Financial Advisers Act 2008. …

When it comes into force there will be a $100,000 fine for:

a) broker who explains on the radio or television why a company is doing well or badly and should be sold;

b) Brian Gaynor for any acid comments to discourage bad investment, or praise for strong companies, unless he can show that despite the common description of him as a funds manager he is actually entitled to an exception for journalists;

c) a broker who acts on phoned instructions from clients he’s known for decades, instead of insisting they give him orders in writing.

There’ll be a $5000 fine for:

a) b) a financially savvy blogger who earns money from ads on his blog, if he says something like, “steer clear of Bridgcorp/Blue Chip – Petriecivic/Bryers will lose your money”;

Sounds like a case of good intentions gone awry.