30 July 2010

Commissioner for Financial Advisers Receives Draft Code of Professional Conduct

(Media releases from the Securities Commission)
30 July 2010

The Commissioner for Financial Advisers, David Mayhew, today received from the Code Committee the draft code of professional conduct for authorised financial advisers for his approval under the Financial Advisers Act 2008.

Mr Mayhew said receiving the draft code was a significant milestone in the implementation of the new regulatory regime governing financial advice to the investing public.

"The code will play an important role in establishing the professionalism and integrity of financial advisers. The next step is for me to review the draft code to consider whether to approve it or not. If I do approve it, then I must forward the draft code to the Minister of Commerce for his approval."

The Act requires the Commissioner to assess the draft code against the specific matters in the Act. Mr Mayhew observed that, "In substance, I have to satisfy myself that the Committee has complied with its consultation obligations and that the draft code it has prepared is consistent with the Act. This will involve a high level review of the content of the draft code with reference to both the minimum standards stipulated by the Act and the purpose of the Act."

The Act does not provide a role for the Commissioner to carry out further or separate consultation.

"If the Code Committee has determined minimum standards of professional conduct which cover the specified matters and which are consistent with the purposes of the Act, and if it has complied with its consultation obligations, then there is likely to be little scope for me, as Commissioner, to take issue with the precise point at which those standards are set. In these circumstances, this is not an opportunity for interested parties to seek to re-argue matters they have already put before the Code Committee", Mr Mayhew said.

Although the Act allows up to 90 days for the task, Mr Mayhew expects to complete his review by the middle of August.


Contact: Rebecca Barclay 04 471 7666