DIMS 'continuum' may prove frustrating

The second tranche of the act’s regulations was released last week.

The FMCA requires advisers who operate class DIMS to apply for a licence from the FMA. Only those who offer a service personalised to each client and their goals and financial situation will be able to continue to operate DIMS under the FAA.

FMA director of compliance Elaine Campbell has said that most AFAs currently providing DIMS are doing so under a class model, mostly because they are using model portfolios. That situation is expressly excluded from personalised DIMS under the legislation, which says personalised advice cannot be advice customised from an investment strategy that applied to a class of clients.

Steps were being taken to make the application process easier for those offering “simple DIMS” such as model portfolios.