A QROPS expert has suggested some offshore pension providers in New Zealand are too lax and have let investors breach scheme rules.
With a potential of an estimated NZ$300 million investment in New Zealand QROPS every year, Mark Hattersley, of financial advice support firm Strategi, alleges some advisers are ignoring QROPS rules and the system needs tightening up.
The firm, based in Auckland has also revealed New Zealand QROPS providers are developing a code of practise to make sure advisers and investors know what to expect when investing in an offshore scheme.
With more advisers participating in this potentially lucrative market, lines between what is a strict pension transfer from the UK to New Zealand versus the provision of advice around the applicability or otherwise, of transferring the pension to New Zealand have blurred, claims Hattersley.
Guernsey QROPS providers have recently issued their own code of practise – believed to be the first in the world.
New Zealand QROPS schemes have come under the spotlight recently. One firm has announced closing to new business from overseas due to regulatory concerns.
Some New Zealand QROPS schemes have come under criticism from other providers who claim these firms breach QROPS rules.
Strategi is also developing a QROPS standards awareness course for New Zealand QROPS advisers and providers.
David Greenslade, managing director of Strategi, reckons the voluntary code and training course are signs of an emerging QROPS professionalism.
He explained that the wider industry realises there is a potential issue with a sub-sector of QROPS products or services, and is taking steps to rectify the problems without having to wait for the regulator or government to initiate change.
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