As of April last year, services such as wrap platforms that provide custodial services must regularly report to their retail and smaller wholesale clients about money and property being held under their watch, under the Financial Advisers (Custodians of FMCA Financial Products) Regulations.

ASB-owned wrap provider Aegis, the largest in the NZ market, is now reporting to clients twice a year.

It sends out a holding report detailing what assets the client holds, a cash transaction report, an asset transaction summary and a pending transactions report.

Acting head of Aegis Peter Dine said the reports were issued in accordance with the requirements of the custodial regulations.

But adviser Meredith Cornelius said it was overkill. “It’s double-up.”

She said people chose to use an adviser because they wanted the adviser's input and help to understand things such as reports, and have them communicated in plain language.

Adding an extra layer of reporting was unnecessary and potentially confusing. “If someone hires an adviser, that’s why they’ve hired them, to interpret things for them and act as a service agent. They’ll call and say why do I have this straight from Aegis?”

It showed a level of distrust in the advisory community, she said. “It would be wrong to say they’re protecting against another Ross Asset Management scenario… they’re constantly treating us like we’re criminals.”

FMA spokesman Andrew Park confirmed custodians had to meet the regulations but said it was important to remember that not every “client" of the wrap platform would be the underlying investor client.

Rival wrap provider FNZ said it had a policy of not speaking to media.