"Nefarious practices tend to follow where the money's going, and the money's going into KiwiSaver," he said.

"I think the FMA are absolutely right to identify KiwiSaver as one of the areas they should be focusing on."

FMA chairman Simon Allen cited the number of New Zealanders in the scheme - just short of 1.8 million - and its central role in retirement savings strategy for the focus.

He said the regulator would be looking at KiwiSaver sales and distribution practices, "and will act decisively against any evidence of misconduct in this part of the market."

Gareth Morgan Investments chief executive Cathy Magiannis said the scheme was relatively new, widely used, and included a Government component.

"So from a risk point of view I assume they've identified that as something important to put some resources in."

The FMA has already issued warnings against SuperLife and unregistered KiwiSaver sales representative Patrick Diack back in June.

Magiannis said the regulator said in talks with the company that they envisage working together with providers "where we continue to evolve and learn together."

"To date everything they've asked for we also believe is important to focus on so we'll evolve and improve, getting consistency around the way some of those things are approached."

She said one area they were keen to see reform on regarding KiwiSaver was around disclosure and reporting, particularly around returns and fees.

"It's not a new issue," she said.

"There's work underway that the Ministry of Economic Development (MED) has been doing. I guess the FMA will pick some of that up in terms of being the agency that will arrange for it to be published in a consistent form."