FMA warns adviser for KiwiSaver advice

James Greig

In a move sending a clear message to the industry, an AFA has been warned after offering bulk KiwiSaver advice to clients.

Roger Gannon, an AFA at Gannon Insurance Brokers, sent a bulk email to his clients in March 2020. He recommended they immediately move their savings in KiwiSaver plans and similar investment funds to “low risk” funds in the wake of market uncertainty caused by Covid.

The FMA was alerted to the communication after receiving a complaint from one of Gannon’s clients.

In May 2020 the regulator issued a formal warning sending a message to Gannon and the industry of its expectations around suitable advice for market conditions. Gannon was not named at this point. 

The FMA made inquiries into Gannon in the following months and discovered further concerns with his advice process. The FMA determined that a public warning was most appropriate in the circumstances, recognising that Gannon cooperated fully with the FMA throughout its inquiries.

Following its investigation, the FMA was satisfied that Gannon contravened the Financial Advisers Act 2008, in particular:

• section 22 by failing to meet disclosure requirements
• section 33 by failing to exercise care, diligence, and skill that a reasonable financial adviser would exercise in similar circumstances.

Gannon told Good Returns that he believes a fair outcome has been reached.