The New Zealand Financial Markets Authority (FMA) has cancelled Filcare Services Limited’s full Financial Advice Provider licence at the firm’s request, following the termination of its distribution agreement with Fidelity Life Assurance Company Limited and AIA New Zealand Limited and a subsequent FMA inquiry. Filcare provided financial advice to around 1,800 retail clients, many of whom were migrant workers from the Filipino community. The inquiry found its advisers breached licence obligations by failing to keep adequate records, ensure clients understood the advice, exercise care, diligence and skill, provide adequate disclosures, and demonstrate that recommendations were suitable. The FMA highlighted shortcomings in nature and scope disclosure, insufficient evidence showing how insurance cover levels were determined against clients’ risk tolerance and needs, and weak replacement advice processes, including limited assessment of existing products, potential lost benefits and other consequences, and insufficient steps to ensure clients understood the risks and implications of switching policies. The FMA also found Filcare did not take reasonable steps to ensure its advisers complied with their duties.
New Zealand Financial Markets Authority 2025-06-26
New Zealand Financial Markets Authority cancels Filcare Services’ financial advice provider licence after inquiry finds breaches of advice obligations
The New Zealand Financial Markets Authority (FMA) cancelled Filcare Services Limited’s Financial Advice Provider licence at the firm's request after an inquiry revealed breaches in obligations, including inadequate record-keeping, insufficient client understanding, and poor disclosure practices. The inquiry highlighted deficiencies in Filcare's advice processes, particularly in assessing insurance cover levels and replacement advice, and found the firm failed to ensure adviser compliance with their duties.