New Zealand’s Financial Markets Authority (FMA) issued a warning to HP Capital Limited, trading as Finbase, for serious breaches of the Financial Markets Conduct Act 2013 and the Financial Markets Conduct Regulations 2014 relating to the offer and advertising of its Single Investment financial products, including sponsored AdWords. The FMA found Finbase made regulated offers without meeting Part 3 disclosure requirements and failed to meet notice obligations tied to the Small Offers exclusion. Although Finbase sought to offer the products to wholesale investors only, it incorrectly applied both the Small Offers and Wholesale Investors exclusions, including by exceeding the NZD 2 million limit across multiple 12-month periods and failing the NZD 750,000 minimum investment requirement for certain investors (either on acceptance or in aggregate for products of the same class). The FMA also identified fair dealing breaches, including advertisements in Farmers Weekly, The Post, Kia Ora and The New Zealand Herald that did not state the products were wholesale-only, and AdWords such as “term deposit” and “low risk investment NZ” that created a misleading impression the products were comparable to term deposits. The FMA considered a public warning a proportionate response, noting the seriousness of the conduct, Finbase’s reliance on inaccurate or inadequate legal advice or its interpretation of that advice, and subsequent remediation steps taken by Finbase.

Original source View in tracker