Part of the Code of Conduct for AFAs requires advisers not to do anything, or make an omission, that would or would be likely to bring the industry into disrepute.

Advisers who think others have breached this requirement are requested to report it to the Financial Markets Authority (FMA).

Code Committee chairman David Ireland said there was not a set definition of what would be considered bringing the industry into disrepute. It would be decided on a case-by-case basis.

Institute of Financial Advisers chief executive Fred Dodds said many in the industry made public comments, particularly about the regulator, that did not seem to be in good form.

He cited examples of the FMA being described as lacking knowledge, and not trustworthy to critique a financial plan.

“That to me does not do the profession any good and from a consumer reading these comments just adds fuel to the fire of other negative articles about the very, very small percentage of advisers who get us bad press. A consumer reading this would only say to these sorts of comments – 'told you so’.”

But he said the Code note that the requirement did not prevent an AFA commenting in good faith on the business, actions or inactions of another person complicated the issue.

“At first glance, you have 'don’t do it' but if you do the hand on heart, the ‘good faith’ clause comes into play. The Final Exposure Draft of the Code is now available and submissions close on April 14. I will ensure we make a submission on this point.”

Questions were raised after an adviser, Tim Fairbrother, was in court recently on a charge of assault. He was acquitted.

The FMA said if an adviser had a conviction they must disclose it at renewal.

But not all convictions would be material.

“The FMA reserves the right to determine whether any disclosed conviction is relevant to their status as an AFA or not, or indeed whether an adviser’s conviction may bring the industry into disrepute - on a case-by-case basis.”