Anti-Money Laundering and
Countering the Financing of Terrorism

Submissions on the third discussion document (Supervisory Framework)

Securities Industry Association (SIA)

INTRODUCTION

The Securities Industry Association (SIA) is an unincorporated body representing the New Zealand Sharebroking Industry. It is a forum for discussing important industry issues and developments, managing industry change, and represents the sharebroking industry in respect of legislative management, operational and regulatory issues that impact the industry as a whole.

The SIA members deal with a combined 190,000 New Zealand retail investors with total investment assets exceeding $40 billion. Association members also deal with virtually all global institutions with the ability to invest in New Zealand.

SUBMISSION

The SIA makes no submission on detailed aspects of the third discussion document, but expresses support for the practical approach proposed of utilising existing structures and organisations, such as the Securities Commission, the Reserve Bank and some SROs, to the maximum extent possible.

SIA members, as NZX Firms, are similarly part of an existing regulatory structure, being subject to the existing co-regulatory regime applicable under the NZX Participants Rules administered and monitored by NZX under the supervision of the Securities Commission.

The SIA submits that, to the extent that the NZX Participant Rules and NZX administration of and monitoring of compliance with those Rules meet the requirements of the proposals contained in the three discussion documents, relief should be granted to NZX Firms from being subject to further direct supervision by the Securities Commission or some other body in this respect.

The SIA also notes the references in the discussion document to the implementation of the Lawyers and Conveyancing Act and the planned review of the Real Estate Agents Act. We reiterate the comments made in correspondence with the Minister of Justice, also in a meeting with the Minister of Commerce and in submission to the Ministry of Economic Development on the Financial Intermediaries discussion document suggesting that the apparent unintended capture of our membership under these statutes needs to be reviewed and addressed.