Updated FMA Guidance for Client Money and Property Services Brokers

The Financial Markets Authority (FMA) has released updated guidance for brokers and custodians handling client money or property, aligning with the Financial Markets Conduct Act (FMC Act). This new guidance, replacing the 2014 note, addresses issues identified through monitoring and misconduct cases. Under the FMC Act, 'providers' now encompass roles previously defined as 'brokers' under the Financial Advisers Act 2008. Custodians, who hold client assets, have additional duties, including audit engagements and client reporting. Key updates include direct custody reporting to clients, secure electronic reporting platforms, and steps for verifying clients' electronic addresses. The rules exclude brokers as defined by the Insurance Intermediaries Act 1994.

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