Delegates at this week's Society of Independent Financial Advisers conference in Wellington questioned whether the Privacy Act would prohibit the FMA accessing client files.

FMA representative Julie Bottomley admitted that it was unclear at this stage whether the authority had the power to request client files.

She said the FMA was talking to lawyers at the moment.

"It's a priority" for the authority right now.

While the FMA has a statutory obligation to monitor financial advisers, Bottomley's fellow FMA member Gavin Austin said "the statutory powers we were given would be toothless" without the ability to see client files.

The FMA intends to release a fact sheet on Privacy Act issues.

Bottomley said the FMA has a team of eight people to monitor the advisory sector which is expected to have around 2000 AFAs and currently has more than 60 qualifying financial entities.

She said the FMA would be making sure that advisers were putting the first part of the code into practice and demonstrating that clients' interests were "first and foremost".

She said this is not just a "tick box" exercise.

Advisers will be given plenty of notice before the FMA does a review and it will conduct the reviews at an adviser's office.

It will review client files if necessary however it will "not jump straight to enforcement."

Bottomley and Austin both asked advisers to work with the FMA.

"If we can't lift standards together the FMA's job is going to be difficult."

"Please try and welcome us."

One adviser said he had heard comments that the FMA were like a pack of Doberman dogs straining at the leash to get out into the market.

Austin said that was not correct.

"Think of us more as the Labrador, cute and friendly."