FMA to look closely at financial guidance practices in Christchurch as part of its priorities for 2013

The financial markets regulator will be taking a close look at financial advice given in Christchurch as part of its priorities for this year

The Financial Markets Authority is signalling it will be keeping a close eye on the quality of financial advice given to Christchurch residents coping with the after-effects of the earthquakes.

The FMA has released its Compliance Focus for 2013 document, in which it outlines four specific priorities for the year.

However, it also gives special mention to the Christchurch rebuild.

"In addition to the four major priorities outlined, FMA is also mindful of the need to support participants and investors throughout the reconstruction of Christchurch," the FMA said.

"The Christchurch rebuild presents a unique environment in which poor conduct could significantly impact a vulnerable community. Many Cantabrians are looking to invest compensation or insurance money whilst they plan their futures and FMA expects participants to deal appropriately with these investors."

The FMA said it would be maintaining surveillance of advice practises in Christchurch and would continue to provide information for investors, where needed, throughout the reconstruction of Christchurch to promote a confident, healthy marketplace.

"While FMA is supportive of capital raising to facilitate the Christchurch rebuild, we expect this to be undertaken with customer needs in mind. FMA is conscious that the situation in Christchurch presents some unique challenges for participants and we will work to assist them. It is important that high standards are maintained in this market."

Otherwise, the four main priorities outlined by the FMA for 2013 are:

1. Building customer trust – participants need to be fair and transparent in their dealings with customers, with customers’ interests central to their activities.
2. Raising standards in existing regimes – we expect participants to demonstrate behaviour above the bare minimum required, with a focus on good conduct, ethics and integrity.
3. Embedding new regimes – participants need to adapt to new regulatory regimes so as to realise the intended benefits for markets and customers.
4. KiwiSaver – participants involved in the management, distribution and oversight of KiwiSaver must ensure they meet regulatory standards and act with customer interests in mind.