Property Investment
3 min read
Author: Andrew Nicol
Managing Director, 20+ Years' Experience Investing In Property, Author & Host
Back in February, I wrote a newsletter to let you know that the Financial Markets Authority (FMA) was doing a routine monitoring visit with Opes.
And I promised to give you an update once we had their conclusions (which we’ve now got).
Lots of people thought I was a bit strange to share that publicly. After all, in the financial world, people often associate government monitoring with wrongdoing.
But the reality is:
We’ve been working closely with the FMA, and after 10 months we’ve finally got the outcome.
There are several conclusions I’m genuinely pleased about. I also want to walk you through the areas they told us we could improve on.
The Financial Markets Authority said that:
And honestly … there were parts we enjoyed.
There’s a lot of work that goes on behind the scenes of our company. Not many people want to sit in a room with us and go through all our spreadsheets! But of course, the FMA were a willing audience.
The FMA also identified three areas where we need to be better.
Because of this, they issued Opes a censure. A censure is a formal statement of disapproval. Opes has not been fined, and it doesn’t affect our licence to give advice.
Here are the 3 areas we’re improving:
The FMA looked through a sample of our records, that includes client files (some going back several years). They found that our records were inconsistent and weren’t always stored the same place.
This was a priority for us even before the FMA visited.
So to address that we hired a Head of Advice to oversee our advisers. We’ve also started using Marloo, a new tool to help our advisers improve their note-taking.
Some people get a Wealth Plan from Opes, but don’t go through the whole process and buy a property through us. That’s fine.
But if those people go out and buy a property through a different company, they might not fully understand the potential downsides of investing.
To address this we’ve updated our financial advice documents. We now include our risk information earlier in the process.
Opes has grown very quickly. We now have several Opes businesses all under one umbrella. (E.g. property management, accounting, mortgages, insurance, financial advice). This can create a potential conflict of interest.
We've always been open about any potential conflicts of interest. That includes in our public disclosures. But, we didn't have an up-to-date conflicts of interest policy. And our conflicts of interest register hadn't been recently updated.
To address that we’ve updated both documents.
There will be some people out there thinking: “Andrew, why are you sending this out to 28,000+ investors? Why not keep it a secret and hope that no one sees?”
It’s because, I am genuinely grateful for the FMA’s input. We are a better business for engaging with them over the last 10 months and making these improvements.
I also believe that the FMA does an important job protecting investors. And this is an example of the system working.
I want to show you the important job the FMA does, and a financial advice provider responding to their guidance. That way you might have more confidence in the financial services industry.
So talking openly about these improvements is about trust. It’s about transparency.
And if you’re keen to read their whole media release, you can find it here.
We also released a podcast this morning, talking through our full response. You can listen to it here.
Got a question? Ask us in the comments section and we'll answer you.
Managing Director, 20+ Years' Experience Investing In Property, Author & Host
Andrew Nicol, Managing Director at Opes Partners, is a seasoned financial adviser and property investment expert with 20+ years of experience. With 40 investment properties, he hosts the Property Academy Podcast, co-authored 'Wealth Plan' with Ed Mcknight, and has helped 1,894 Kiwis achieve financial security through property investment.
This article is for your general information. It’s not financial advice. See here for details about our Financial Advice Provider Disclosure. So Opes isn’t telling you what to do with your own money.
We’ve made every effort to make sure the information is accurate. But we occasionally get the odd fact wrong. Make sure you do your own research or talk to a financial adviser before making any investment decisions.
You might like to use us or another financial adviser
