Dalziel Lianne: Securities Disclosure and Financial Advisers Amendment Bill — In Committee 
Dalziel Lianne: Securities Disclosure and Financial Advisers Amendment Bill — In Committee 
[Volume:655;Page:4978] 
Hon LIANNE DALZIEL (Labour—Christchurch East) 
: 
 New Zealand is probably alone in the world in deregulating in the face of what has occurred overseas. I would be very interested to hear what other members of the Government have to say about that issue. 
I will speak about one particular issue which is the whole question about experienced investors and wealthy investors. The issue the previous speaker has not taken into account is measuring somebody’s ability to invest without proper advice being given to them and not having all of the detailed information that is available through a prospectus explained to them. Just because someone has a large amount of money it does not necessarily make him or her someone who needs to be protected from this overregulation which is how we have just had it described. 
I make the point that there are business people in this country who have retired who put every single last cent of their money into ING and they are now facing a 60 percent return on that investment. Those people deserve to have the full ramifications of their investment explained to them. I have made the comment on more than one occasion that ING in offering 60c in the dollar really owes the country an explanation as to why it says that those who accepted the 60c in the dollar should release ING from any consequences that may flow from a Commerce Commission investigation. I cannot believe that members of the Government think that that is OK because it is not OK. 
That is why I have raised a concern both at the select committee and in subsequent comments that I have made on this legislation that although we are not opposing the specific amendment around wealthy investors some of us are very concerned that changes are being made to the exemption when the exemption itself may be repealed as a result of the review of the financial products and providers process. 
Personally I think the exemption should be repealed as the discussion document stated. The people who proposed these changes the Capital Market Development Taskforce when they appeared before the committee had not even read the discussion document that had been put out on this very subject of wealthy investors. I think it behoves us to give this matter a little bit more careful consideration. 
The discussion document describes the wealthy investor category as the least principled exemption in the Securities Act. It is very important that we look at the recommendations in that discussion document which are to beef up the provisions around sophisticated investors. These are the real people who are prepared to take the risks. The professional habitual and experienced investors are sophisticated investors. Let them make a choice about where they get their information from. I have no objection to that. But we should not say that somebody is able to make those decisions without having the protections that the law is supposed to give. I know that the Government likes to talk about it as regulation; let us talk about it as protection. Someone cannot just give up that right to protection simply because he or she has a large sum of money at a given moment in time. I would expect someone selling a business to have more than $500000 in the bank if he or she has been any good at running a business. That does not necessarily mean that that person will be able to make a good decision on where to invest that money in terms of how it will support him or her in retirement. 
I think the Minister should respond to the question about why we are making an amendment to the wealthy investor provision when in fact we will be undertaking a serious review of the legislation as a whole and we will be looking I hope at beefing up the professional habitual and experienced investors category. 
I should also make the point that we have clarified in this bill that somebody who is asserting this exemption will sign a document stating that he or she will not be receiving any of the information that is usually provided by an issuer offering securities to the public. Again that is a very clear statement that the investor is accepting the responsibility of going ahead with the investment without having that particular information. I would like the Minister to respond to that question.