New Zealand's FMA Censures FoxPlan

The Financial Markets Authority (FMA), New Zealand's financial regualtor, has formally censured Wellington-based financial services firm FoxPlan Ltd, after one of its nominated representatives provided services he was not permitted to give and other representatives offered services to clients they were not permitted to give.

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Following a monitoring review in late 2020, the FMA found one of FoxPlan's Auckland-based nominated representatives had provided an investment planning service to some clients since mid-2018. Under the Financial Advisers Act (FA Act) 2008, only Authorised Financial Advisers (AFA) were permitted to provide this service, which involves designing a plan based on an individual's financial situation and identification of the individual's investment goals.

Additionally, the FMA found four of FoxPlan's representatives wrongly held out to clients that they were an AFA or financial planner. Separately, the FMA had reason to believe FoxPlan's AFAs failed to comply with disclosure obligations - specifically, the need to provide retail clients with their primary disclosure statement (PDS), an important document to ensure a client understands the service they are receiving.

James Greig, FMA Director of Supervision, said: "This case reiterates that financial advice firms can be held liable for the actions of their financial advisers."

Mr Greig said: "A financial adviser providing a service they are not permitted to carry out is a considerable issue because it has the potential to lead to poor customer outcomes, such as the loss of funds from inadequate service. New Zealanders put their trust and their families' financial wellbeing in the hands of their financial advisers so it's critical we can be confident an adviser is appropriately qualified for the services they provide."