Pansy Wong MP National Party Commerce Spokeswoman

20 June 2006

Labour drags chain on protecting investors

The receivership of Provincial Finance has highlighted Labour's lack of action in the financial services sector, says National's Commerce spokeswoman, Pansy Wong.

"The fact that $9.5 million of investors' funds were poured into Provincial Finance between the withdrawal of its prospectus on April 10 and its receivership on May 10 has put the competency of some financial advisers back into the spotlight.

"In 2004, the Labour Government promised action after the International Monetary Fund scored New Zealand poorly with regard to the regulation of financial intermediaries.

"A taskforce was set up, and last year it recommended that a separate body approve standards for individuals and businesses who provide financial services.

"However, Labour decided there was no need to rush this, and legislation isn't likely to be in place until 2008.

"In the meantime, the Securities Bill, which requires disclosure from financial advisers about their qualifications and experiences, and imposes bigger fines for breaches, was introduced in 2004 and reported back to the House in June last year, but has sat gathering dust on the order paper.

"National supports this bill because it will give better protection to investors, but nothing can happen till Labour back up their words and give it urgent attention.

"Until they do, investors will be left with no protection."

ENDS

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