New Zealand FSP License Compliance Officer Service

Compliance Officer for New Zealand FSP License

• A New Zealand FSP License compliance officer is an important role that monitors that financial service providers are compliant with the restriction and obligations imposed on them by New Zealand authorities. A compliance officer will conduct compliance reviews, maintain up to date with the requirements of legislation which are constantly changing in the industry, and provide ongoing advice and training to financial advisers and companies to ensure they are complying with their obligations. A compliance officer will also have responsibility for the AML (anti-money laundering) audit as well as ensuring that there is a process in place which adheres to Financial Markets Authority (FMA) information and guidelines.  

• The last few years have seen significant growth, and with greater enforcement processes in NZ financial services. Recently in 2023, there are over 2,500 financial advice providers licensed to provide advice or registered as bodies with 1360 licensed financial advice providers (FAPs) and 8838 advisers listed on the Financial Services Providers Register (FSPR). Interestingly, as of December 2022 – 86% of financial advice providers had either started or finished their full licensing status. This data reinforces the developing role of compliance officers in overseeing compliance to support the integrity of the sector throughout the transition and to help companies manage legislative change. 

• At Tetra Consultants we understand to register company in New Zealand is the first phase for businesses that want to enter the financial services business and obtain an FSP license. Your dedicated team of Tetra Consultants professionals will hold the client’s hand throughout the entire process. They will assist clients with selecting the right business structure and reserving a company name, lodging all administrative documents in the Companies Office. They will also ensure full compliance with New Zealand’s tax and employment regulations, providing a perfect pathway towards the application process for FSP licenses. With Tetra Consultants, clients can relax knowing they will be provided with all the information needed to deal with the regulatory environment and be able to focus on running a financial services business in New Zealand. 

Benefits of appointing New Zealand FSP License compliance officer 

Assures regulatory compliance 

• The compliance officer is the very core player in ensuring a financial service provider complies with all applicable legislation or regulations, including anti-money laundering (AML), countering the financing of terrorism (CFT), and Know Your Client (KYC) requirements. They actively engage with legislative change, regulatory updates, and compliance requirement changes in other ways, to save the company from regulatory consequences and reputational damage caused by non-compliance. They deal with the obligations associated with licensing and operating the company with the least potential interruption or losses in the company’s interests. 

Manages licensing obligations on an ongoing basis 

• Obtaining a license is just the start: thereafter they have continuing obligations. They continue to comply with various obligations to maintain compliance with licensing. The compliance officer will be able to oversee timely submission for the required report, renewal application, and documentation updates as required. Compliance officers also ensure that client agreements are produced at any remedial or sanction, or they will face long delays and disruption in the company’s operations. 

Carrying out risk assessments and AML programs 

• The management of risk and implementation of AML programs must be proportionate to the risks faced by financial service providers pursuant New Zealand Regulations. The role of the compliance officer is to develop, implement and review the provisions and protocols to identify, mitigate and respond to issues of fraud, anti-money laundering and terrorist financing. Part of this process involves ongoing monitoring of suspicious activity to allow early identification and mitigation in order to protect the company and its clients from crime exposure and regulatory penalties. 

Acting as a liaison with regulators 

• The compliance officer is often the first point of contact between the company and key regulators like providing timely and accurate responses with soda formulations, inquiries, audits and investigations are essential to achieving timely and transparent communication. Building a wait time with regulators is important particularly in a compliance review or when regulatory stuff gets complicated; regulators take diligence and credibility seriously. 

Reinforces business credibility and client trust 

• Clients and investors care about a company’s compliance with regulations and having a compliance officer reinforces the company’s commitment to ethics and the law, which enhances the company’s reputation in the market and better attracts clients, partners, and stakeholders. Strong compliance frameworks lower the risk of scandals or operational failures that can tarnish client trust. 

Facilitates consistent internal procedures  

• A compliance officer creates and maintains policies, procedures, and manuals on internal compliance that will meet the requirements of the company’s FSP license. They take the burden of making all employees aware of their compliance responsibilities and consistently following the same procedures. These structures will reduce errors, improve operational efficiency, and create a culture of compliance to sustain success long-term. 

Mitigates operational risks 

• Through ongoing training and monitoring, the compliance officer ensures that staff members performing compliance-related activities are competent and informed. These activities will reduce the likelihood of human error, negligence, or intentional wrongdoings that result in regulatory breaches or financial loss. By recognizing possible deficiencies in controls, the compliance officer can protect the company’s assets and reputation. 

Facilitates business growth 

• Having a compliance officer ensures that the company is compliant not only with local standards but also with international regulatory standards. This is becoming increasingly important due to the globalized nature of the financial market. Maintaining compliance readiness facilitates entry into overseas markets and partnerships with international financial institutions. It furthers the company’s sustainability plans and supports reputable growth and expansion strategies. 

Who should appoint New Zealand FSP License compliance officer? 

Licensed Financial Service Providers (FSPs) offering financial advice or services to retail clients:   

• An individual or entity which provides financial advice or product to retail clients within New Zealand must have a Compliance Officer to be compliant with the Financial Markets Authority (FMA) licensing requirements as well as ongoing compliance with the Code of Professional Conduct and AML/CFT obligations. 

Entities issuing or holding an FSP License:   

• Entities that are obtaining an FSP license or have one, require a Compliance Officer to implement and oversee their Financial Compliance Program (FCP), including systems, policies, protocols and controls to ensure compliance with the Fair Conduct Principle and other regulations. 

Financial Advice Providers (FAPs) with more than one adviser:   

• An organization with more than one financial adviser or non-nominated representative must have a Compliance Officer to monitor competencies, conduct and compliance of all advisers, ensuring they comply with the conditions of their license and ethics. 

Companies conducting regulated financial services:  

• Businesses engaging in asset management, securities, investment advisory or other regulated financial services must appoint a compliance officer to manage risk assessments, customer due diligence, suspicious transaction reporting, and record-keeping as part of their AML/CFT program. 

Large financial institutions and businesses with complex or diverse operations: 

• It is necessary to appoint a compliance officer and potentially a compliance department for large, complex or diverse operations to effectively exercise oversight and maintain adequate internal controls and complete regular compliance testing to meet the FMA’s expectations.  

Businesses registering as financial service providers: 

• Although, businesses registering on the Financial Service Providers Register (FSPR) have not been licensed yet, they should appoint a compliance officer to start preparing and maintaining compliance frameworks in regard to New Zealand’s financial system regulations. 

Eligibility for New Zealand FSP License compliance officer

• For a New Zealand FSP License, it is not necessary for a compliance officer to be a local compliance officer in New Zealand; in fact, the compliance officer could be a foreign citizen.  

• It is still recommended that the compliance officer have a minimum of three years’ work experience in compliance or the provision of a financial service to understand and execute their regulatory obligations.  

• The compliance officer must be appointed and ready to go before any FSP registration application is submitted to demonstrate compliance and oversight prior to commencing the business.  

• The company needs to meet one of the most significant requirements, which is to show that the company has a physical office in New Zealand, which can either be a co-working space or a private office, even if the services being provided are completely Online.  

• The company is also required to have at least one New Zealand resident director who can manage the business and communicating with regulators and government agencies as required. This requirement can be met by the nominee director and shareholder services. 

• The compliance officer and directors will all be subject to a fit and proper person assessment that includes background checks for criminal history, financial probity, and reputation.  

• The compliance officer has a duty to plan, implement, and administer an effective Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) program including risk assessments, staff training, and reporting suspicious transactions. 

• The company must have written policies and procedures to meet all regulatory obligations, such as client due diligence, record keeping, and reporting obligations. 

• Ongoing training and vetting of compliance officers and staff are needed to continue awareness and compliance with New Zealand’s financial regulations. 

• The compliance officer is responsible for ensuring all reports are submitted to the Financial Markets Authority (FMA) in a timely manner and ensuring continued compliance with evolving regulations. 

New Zealand FSP License compliance officer assistance 

• Tetra Consultants offers complete outsourced compliance officer services to licensed and registered New Zealand FSPs, both active and dormant. The compliance officers have an in-depth knowledge of the Financial Service Providers (Registration and Dispute Resolution) Act 2008, AML/CFT Act 2009, and any other applicable regulatory obligations determined by the FMA and DIA. All compliance officers hold professional certifications, many with CAMS (Certified Anti-Money Laundering Specialist) and further relevant regulatory qualifications, and over 5 years of industry experience. 

• When you appoint Tetra Consultants to be your outsourced compliance officer you will receive: 
  • Ongoing maintenance of your AML/CFT program and periodic risk assessments. 
  • Assisting in the preparation of annual AML/CFT reports and audits as required by the regulator. 
  • Assisting with compliance filings and reporting to regulators, internal compliance reviews. 
  • Providing assistance with maintaining registration, governance processes, and dispute resolution schemes. 
  • Liaison with the supervisory authority (FMA, DIA, or RBNZ) on your behalf. 

• Our aim is to ensure your FSP entity is compliant, risk aware and trusted in New Zealand’s regulated environment so you can focus on your business with peace of mind. 

Steps for appointment of New Zealand FSP License compliance officer