An independent consumer organisation’s scathing assessment of financial advice has led to the exit of two members from the industry committee working on New Zealand’s code of professional conduct for financial advisers.

Moneymax Director Liz Koh and former Head of Wealth Management at Westpac Patrick Middleton are linked to firms whose advice was ranked “rejected” in a report by Consumer NZ after a “mystery shopping” investigation.

Financial Advisers Commissioner Annabel Cotton says she has accepted their resignations “to remove the potential for loss of public confidence” in the committee’s work.

She says the development should not be seen as a reflection on the professional competence of the individuals or their companies.

Ms Cotton – who will be replaced in January by lawyer David Mayhew – appointed the committee in July to develop and maintain the code that will set minimum standards of competence, knowledge and skills, ethical behaviour, client care, and professional training requirements.

The code is expected to be complete by early next year and implemented by year’s end.

A full report on the NZ mystery shopping campaign results will be published in the December issue of Insurance News (the magazine).