Burns Brendon: Financial Service Providers (Pre-Implementation Adjustments) Bill — Second Reading In Committee 
Text is incorporated into the Bound Volume 
Burns Brendon: Financial Service Providers (Pre-Implementation Adjustments) Bill — Second Reading In Committee 
[Sitting date: 22 June 2010. Volume:664;Page:11958. Text is incorporated into the Bound Volume.] 
BRENDON BURNS (Labour—Christchurch Central) 
: 
 I am pleased to take a short call on the Committee stage of the Financial Service Providers (Pre-Implementation Adjustments) Bill. If ever there was an illustration of the need for legislation like this it came on  
Morning Report 
 this morning where a spokesman appeared for those who had lost money in the debacle around ING (NZ) owned by the ANZ group. The spokesman for that group was himself a financial investment adviser and he was amongst those who had lost money in what had happened with ING. That is because there is not across the financial sector the sort of disclosure that is required for people to know whether they are getting the right advice whether they are making the right investments and whether they are making the right choices to protect themselves and their families when making what can often be long-term investment decisions. So the importance for clarity the importance for transparency and the importance for people to know exactly what they are getting is at the core of this bill and it is to be applauded. It is another signal and message I think that markets do not always deliver everything that people need which is sometimes a mantra we hear. We must have appropriate regulation in place to protect people sometimes from themselves and sometimes from people who are not transparent who are not currently accountable and who sometimes have an agenda behind what it appears they are providing by way of service and assistance. 
Last year my wife and I went to find a financial adviser to give us some advice about our future. We chose a reputable firm. I have no doubt that the adviser we chose gave us good advice but I had no real security around the fact that that was being provided by him. It is a little bit of a lottery so this bill assists in that respect in terms of the transparency and accountability for advice provided. We were not in a situation of requiring any particular financial instruments from the adviser we sought—it was simply in the line of advice—but obviously that can be compounded and present potential conflicts of interest. 
I note that we have seen many many thousands of New Zealand investors who have lost money in the myriad financial company collapses over the last 3 or 4 years sometimes after advice from financial service providers to put investments into a particular organisation and institution—into the likes of Hanover Finance which I seem to recall used to promote itself on State-owned television Television New Zealand as the name one could trust. Of course that turned out to be absolutely not the case. 
I welcome this bill. I think it will help to protect people against some of the slick advertising and marketing that we see and give people more confidence that when they make investment choices guided by financial advisers they have every reason to believe that that advice is provided appropriately and transparently.