Conduct outcomes report 2017

Aim: To outline for financial service providers regulated by the FMA, the areas of misconduct observed by the FMA during 2017 and how it responded to them.

Outcome: Completion of this module will help advisers to:

  • Understand the FMA’s recent regulatory and enforcement work in the areas of misconduct by financial market participants;
  • Understand how, and why, the FMA responded to specific cases of misconduct;
  • Assess their own conduct practices to ensure they would meet the FMA’s expectations, and consider some of the good practice suggestions made by the FMA in the report; and
  • Be informed about the FMA’s focus in 2018.

Abstract: Good conduct matters because conduct is at the heart of all clients’ experiences of financial products and services. This report, relevant not just to licence holders under the FMC Act, but all in the financial services industry, provides insights into several key actions taken by the FMA. These actions include assessing how licensed participants are meeting the conditions of their licence; taking court action against Milford Asset Management trader Mark Warminger; investigating Goldman Sachs’ trading activity, and engaging with industry regarding trading conduct relating to New Zealand’s Bank Bill Benchmark Rate and closing rates. The report also sets out information on some of the cases where the FMA has either prevented registration on the FSPR, or directed the registrar to deregister a company from the FSPR.

The report provides useful good practice guidance for market participants to help them demonstrate how they act in the customer’s interests and provides information about the regulatory focus of the FMA in 2018.

Strategi Institute recommends advisers undertaking this module also undertake the module A guide to the FMA’s view of conduct, if they have not already done so.