Jones Shane: Financial Markets Conduct Bill Financial Markets (Repeals and Amendments) Bill — Third ReadingsText is incorporated into the Bound VolumeJones Shane: Financial Markets Conduct Bill Financial Markets (Repeals and Amendments) Bill — Third Readings[Sitting date: 27 August 2013. Volume:693;Page:13012. Text is incorporated into the Bound Volume.]Hon SHANE JONES (Labour): Ā kia oraanōtatou e nohoneii rotoitōtātou Whareitēneipō.[And so greetings once again to us seated in our House tonight.]I rise to support the Financial Markets Conduct Bill and the Financial Markets (Repeals and Amendments) Bill. I should note the contributions made by the current Minister of Commerce the predecessor Simon Power—who is somewhere up in Westpac’s parlour counting all the money—and also Clayton Cosgrove and Lianne Dalziel. It seems so long ago since this issue first came on to the horizon. There probably was a lot more that should have been done a lot earlier. We were constantly receiving accounts in 2003 2004 2005 2006 2007 and 2008 that people were promising extraordinarily high interest rates but there was an absence of sophistication from the owners of the savings and the providers of the capital to the various schemes of the time. I remember saying to one or three of them myself: “Look if someone is offering you that level of interest return rest assured great risk will be involved.”But the machinery of the State at that time to deal with that kind of problem—i.e. sucking money from retirees and from a host of other savers into the various schemes that turned to custard—really has been a blight. I know of many people who approached me who have had to sell their properties—in Kerikeri for example where there is a host of retirees who have fled from the super-city up to the temperate climes of Tai Tokerau. They have had to completely downgrade the quality of their lives because—if I could just focus for a moment on the finance companies—what money they had disappeared into the ether once those companies turned to custard. In fact I recall Dover Samuels bumping into a MrPetricevic one night in a restaurant in Parnell. He approached MrPetricevic and acquainted him with the fact that Dover had been an investor in one of those schemes. I think the night ended with the police almost having to be called to restrain one of those investors from Kerikeri orMatauri Bay who made his point in a pretty fulsome way as you would expect from our former colleague.All New Zealand has an investment capital deficit. We actually import so much of the money we use and recycle into mortgage housing or we rely on international investors in Christchurch for example although there are billions of dollars that the insurance industry has paid out. Without a doubt a lot of dough going into Christchurch is going to be sourced internationally.So when we go and promote our credentials internationally in order to overcome this deficit it is good that this legislation contributes to the enhancement of our reputation and that there is a regulatory framework in which people can have trust as they should given the favoured status that we have sought and currently enjoy in terms of OECD rankings. We have a stable Westminster parliamentary democracy contract law thatcan be enforced and a judicial system that remains utterly independent and neutral from the executive but hopefully with the efforts of the current Attorney-General and David Parker a judiciary that knows that the sovereignty of Parliament in our system cannot be eclipsed. That is another issue and it is something that I know has consumed the mind the time and the imagination of the President of the Supreme Court. But at the pith of our system this is where law is made that is where law is interpreted and No. 1 The Terrace Treasury is where law is executed. That is the importance of the hierarchy. So that is one of the credentials that we should burnish.This system allows new immigrants Kiwi citizens residents and overseas investors to trust that when a document is produced what that document promises to deliver on is actually enforceable. So what we have now with the supercharged Financial Markets Authority is no ambiguity that the organisation is empowered to make a call. It has the necessary powers of discretion to determine whether future innovations are in or out of the regime.I do think there should be some flexibility and I am glad that the Commerce Committee did address the importance of flexibility. The last thing we really want to do is stunt or impede the ability of the providers of opportunity and the providers of capital to come together but we cannot go back to the bleak times when thousands of Kiwi retirees families and others were fleeced. In fact some of those schemes had a Nigerian-like quality about them. I happen to know about some of those schemes given that I know some of the people who went to jail for putting the money ofMāori trusts into such schemes. So it is something that has swept—the member for Rotorua Todd McClay nods in acknowledgment. However having done the crime served the time hoki mai get on with life. That is my approach to these matters.Having said that this piece of legislation should command support from both sides of the House. Without capital there is no ability to grow our economy. Without trust—not so much in the executives but in the quality of the document and its ability to be enforced with criminally based punitive actions. That will gain the attention of those who have been prepared to take a risk and suffer civil consequences. The sobering prospect of ending up with the Mongrel Mob next door in theNgāwhā prison for breaking these laws I am quite sure will focus the minds of those folks who live in the leafy suburbs of RemueraKohimārama and other such places. It is not a pleasant experience to go to theNgāwhāhīnaki or prison. I am quite sure that those senior graduates in accountancy finance and legal studies will get a lifetime’s education in the event that they arrive there. I am only saddened that this did not actually come in earlier. I am also saddened that this was not around in the times when the last bout of the Wild West was acted out. But now that it is here I think it is important that the institution implementing it has a very effective education programme because many of the professionals will certainly search for ways to circumvent it.There is an important principle when dealing in these kinds of areas: execute figuratively one or three and educate a thousand. Rest assured once a couple of shonky characters caught under this regime go away and do a bit of time for 2 or 3 years the others in the Wellington club and the Auckland club will be suitably focused on the importance of adhering to these new rules. It sounds a bit rough the way I described it but it was actually rougher for the people who lost all their dough. It was rougher for the grandmothers the grandfathers and the parents who lost the majority of their savings when they unwisely trusted the quality of the commentary in the offer documents or they felt they could trust the lawyers the accountants and the financial planners giving them advice.This time round they will find that trust is not an emotional concept. Trust is something that once you violate it you go to jail and do your time. That surely mustimprove the prospect of investors gathering lots more confidence and people providing opportunity for investment capital owning their own obligations. We support the bills.