Blair Vernon, director of advice and sales at AMP, said he had concerns about members who were being moved between providers with little consideration given to whether it would benefit them.

He said he had dealt with clients who had been materially disadvantaged by the decision to switch.

In some cases, they had ended up missing out on additional contributions from their employer because they moved out of the employer's preferred scheme.

“They switch and then down the track find 1%, 3% or more in contributions they could have been getting is not going in.”

In another case, a KiwiSaver member was not able to claim on their group insurance policies because they were contingent on being a member of a certain scheme, from which they had shifted.

"In almost all situations the proactive activities of the sales representative takes zero consideration of the current arrangements in place for the client,” Vernon said.

He said Australian financial service providers would not be able to suggest a change without showing they had considered the consequences of that in relation to the client's existing products.

"It’s a question of at what point can there be seen to be an injury to the client and whose responsibility is that. Ultimately it's something the regulator needs to take a view on," Vernon said. "It comes back to what level of obligation do you have to understand people's current arrangements."

Financial Markets Authority director of regulation Liam Mason said the regulator expected KiwiSaver providers to put customer interests first.

But he said FMA investigations had shown most providers were offering a sales, not advice, model.

"We will continue to monitor KiwiSaver switching and retention tactics to ensure members are being treated fairly, and continue to work with them on any issues identified in our ongoing supervision. We will be looking for improvements from providers to ensure they meet the new conduct obligations of the Financial Markets Conduct Act.”