Financial Markets Authority (FMA) — New Zealand

Overview

Official Regulator | New Zealand's national conduct authority for financial markets, services, and reporting entities.

The Financial Markets Authority (FMA) is an independent Crown entity and the principal conduct regulator for New Zealand's financial markets. Established under the Financial Markets Authority Act 2011, the FMA promotes fair, efficient, and transparent financial markets while protecting consumers and facilitating innovation in the financial services sector.

The FMA operates with statutory responsibilities across multiple regulatory domains including securities, derivatives, managed investment products, financial advisers, market infrastructure, and emerging areas such as crypto-asset services. With approximately [UNVERIFIED: 300+] staff and a national mandate, the FMA employs an outcomes-focused regulatory approach designed to address conduct risks and market harm.

Key Statutory Objective: To promote and facilitate the development of fair, efficient, and transparent financial markets, and to promote the confident and informed participation of businesses, investors, and consumers in the financial markets.

Basic Identity

Classification

Inclusion Justification

What This Entity Oversees

Regulatory Scope

The FMA regulates the following financial service providers and products:

Regulated Entities

• Financial Services Providers (FSPs): Investment advisers, brokers, fund managers, insurance brokers, and other licensed intermediaries
• Registered Banks: While primary prudential regulation is handled by the Reserve Bank of New Zealand (RBNZ), the FMA regulates conduct
• Managed Investment Scheme Operators: Including Registered Investment Advisers and Fund Managers
• Market Operators and Infrastructure Providers: Licensed exchanges and alternative trading platforms
• Financial Markets Utilities: Clearing houses, settlement systems, and market infrastructure operators

Financial Products

• Securities: Debt securities (bonds, notes) and equity securities (shares)
• Managed Investment Products: Schemes accepting funds from multiple investors
• Derivatives: Futures, options, swaps, and over-the-counter contracts
• Insurance Products: Excluding life insurance (regulated by Department of Internal Affairs)

Licensing and Authorization

The FMA operates a licensing framework requiring authorization for:

• Financial Service Providers offering financial advice or dealing in financial products
• Market Operators and Alternative Trading Platforms
• Derivative dealers and traders
• Managed investment scheme operators

Licensing Authority: The FMA grants, refuses, cancels, or suspends licenses based on fit-and-proper person requirements, capital adequacy, operational capability, and compliance with AML/CFT obligations.

Conduct Standards

The FMA enforces comprehensive conduct obligations including:

• Know Your Client (KYC) and Customer Due Diligence (CDD) requirements
• Disclosure and transparency standards
• Conflict of interest management
• Anti-market abuse provisions (insider trading, market manipulation)
• Client money and asset protection
• Record-keeping and reporting requirements
• Adherence to financial adviser codes of conduct

Crypto and Digital Asset Regulation

Regulatory Approach

New Zealand has opted for a technology-neutral regulatory framework rather than creating bespoke crypto legislation. The FMA applies existing financial markets law to digital assets and crypto-asset services, determining on a case-by-case basis whether tokens or crypto products fall within the definition of "financial products" under the Financial Markets Conduct Act 2013.

Classification of Crypto-Assets

The FMA assesses whether crypto-assets constitute regulated financial products under four categories:

1. Debt Securities — Crypto-assets providing a right to be repaid money or paid interest qualify as debt securities and require disclosure and licensing compliance
2. Equity Securities — Digital tokens conferring ownership rights in an underlying asset
3. Managed Investment Products — Crypto funds accepting pooled investments
4. Derivatives — Crypto futures, options, or swaps used for hedging or speculation

Unregulated Digital Assets: Crypto-assets used purely as a means of payment (without income-generating features) may fall outside the Financial Markets Conduct Act's scope. The FMA's landmark 2026 ruling determined that the NZDD stablecoin issued by Easy Crypto was not a regulated financial instrument due to its use as a payment mechanism rather than an investment vehicle.

Crypto-Asset Service Providers

The FMA supervises crypto-asset service providers offering:

• Cryptocurrency exchanges (spot trading)
• Crypto custodial services
• Stablecoin issuance and management
• Blockchain-based financial products
• DeFi-adjacent services (where applicable)

Compliance Requirements: All crypto service providers engaging in regulated activities must comply with AML/CFT obligations, licensing requirements, and disclosure standards.

Emerging Frameworks

The FMA is actively developing guidance on:

• Tokenization in Financial Markets — Assessing distributed ledger technology (DLT) applications for securities settlement and issuance
• Stablecoin Regulation — Determining regulatory treatment of fiat-collateralized and algorithmic stablecoins
• DLT Settlement Systems — Assessing whether blockchain-based settlement infrastructure meets regulatory standards

Consumer Protections Framework

Financial Services Guarantee and Dispute Resolution

Financial Services User Scheme (FidServ): [UNVERIFIED: A voluntary scheme providing dispute resolution and limited financial compensation for consumers of financial services.] Managed by the Financial Services User Scheme Operator, participants must be licensed financial service providers.

Key Features:

• Free dispute resolution for consumer complaints
• Compensation up to NZD $200,000 for eligible claims (limits vary by service type)
• Independent ombudsman review of complaints

Disclosure Requirements

The FMA mandates clear and accurate disclosure to consumers including:

• Product information statements (Product Disclosure Statements — PDS)
• Financial adviser disclosure documents
• Risk warnings for complex financial products
• Periodic performance reporting for managed investments

Market Integrity Protections

The FMA enforces provisions designed to maintain fair and transparent markets:

• Insider Trading Prevention — Prohibits trading on material non-public information
• Market Manipulation Prohibition — Bans artificial price manipulation and misleading trading practices
• Continuous Disclosure Obligations — Requires listed companies to immediately disclose material information
• Short-selling Transparency — Tracks and reports short-selling activity
• Beneficial Ownership Disclosure — Requires identification of ultimate ownership in listed entities

Licensing and Suitability

The FMA ensures investor protection through:

• Fit and Proper Requirements: Licensing only of individuals and firms meeting character, competence, and financial viability tests
• Competence Standards: Mandatory qualifications for financial advisers and investment professionals
• Financial Adequacy: Capital and liquidity requirements for financial services providers
• Professional Indemnity Insurance: Mandatory coverage for licensed advisers

Related Entities

• Reserve Bank of New Zealand (RBNZ) — Prudential regulator for banks and systemic financial stability
• Department of Internal Affairs — Regulates insurance, betting, gaming
• Inland Revenue Department (IRD) — Tax authority with AML/CFT reporting obligations
• Financial Services User Scheme Operator — Consumer dispute resolution
• Securities Commission [HISTORICAL] — Disestablished 2011; functions transferred to FMA

Regulatory Powers

Investigation Authority

The FMA holds broad investigatory powers under the Financial Markets Conduct Act 2013 and Financial Markets Authority Act 2011:

• Compulsory Information Gathering: Power to require production of documents, records, and testimony from any person or entity under investigation
• Search Powers: Authority to conduct premises searches with judicial warrant to gather evidence of serious contraventions
• Examination Powers: Ability to require witnesses to appear and provide sworn testimony before FMA investigators

Enforcement Actions

The FMA employs a graduated enforcement approach:

Civil Remedies

• Cease and Desist Orders: Directives to stop unlawful conduct immediately
• Financial Penalties (Infringement Notices): Up to [UNVERIFIED: NZD $300,000] for breaches of financial advice and conduct requirements
• Court Injunctions: Sought through District or High Court to prevent ongoing misconduct
• Compensation Orders: Court-ordered restitution to affected investors
• License Cancellation or Suspension: Removal of authorization to operate

Criminal Prosecution

• Criminal Charges: Reserved for serious, intentional, or reckless misconduct
• Maximum Penalties: Fines up to [UNVERIFIED: NZD $3 million] and/or imprisonment for directors/managers found guilty of breaching financial market laws
• Disqualification: Banning individuals from holding financial services licenses or directorships

Enforcement Policy

The FMA publishes an Enforcement Policy detailing its approach to:

• Prioritization of enforcement cases based on harm and consumer impact
• Graduated response framework (warning, infringement, civil, criminal)
• Cooperation with overseas regulators in cross-border cases
• Coordination with Department of Internal Affairs and Inland Revenue (IRD)

Enforcement Track Record: The FMA actively pursues market manipulation, insider trading, fraud, unauthorized financial services provision, and breaches of AML/CFT obligations.

Regulatory Role and Function

Legal Foundation

Establishing Legislation

The FMA derives its authority from two primary statutes:

1. Financial Markets Authority Act 2011 (No. 5) — Establishes the FMA as an independent Crown entity and defines its functions, powers, and governance structure. Came into force on 1 May 2011.
2. Financial Markets Conduct Act 2013 — The principal conduct regulation statute governing financial products, financial services providers, and market participants. Represents the largest statutory reform of financial markets regulation in New Zealand in at least 30 years.

Additional Legislative Framework

The FMA also operates under and enforces compliance with:

• Financial Service Providers (Registration and Conduct) Act 2008 — Governs financial adviser registration and conduct obligations
• Securities Markets Act 1988 — Establishes core market operating rules
• Financial Advisers Act 2008 — Sets standards for financial adviser conduct
• Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML/CFT Act) — Customer due diligence and reporting obligations
• Deposit Takers Act 2023 — Prudential regulation of registered banks and deposit takers
• Financial Markets (Derivatives) Amendment Act 2012 — Governs derivatives markets and trading

Crown Entity Status

As an independent Crown entity under the Crown Entities Act 2004, the FMA operates with statutory independence while remaining accountable to Parliament through the Minister of Commerce and Consumer Affairs.

Licensing and Authorization Relevance

Regulatory Approach to Fintech

The FMA actively engages with financial technology innovation while maintaining consumer protections. The regulator has adopted a principles-based regulatory approach allowing flexibility for emerging business models:

• Regulatory Sandbox Consideration: [UNVERIFIED: The FMA may provide guidance and temporary relief for firms testing innovative financial products in limited market trials.]
• Proportionate Regulation: Application of regulatory requirements scaled to risk and consumer impact
• Technology-Neutral Rules: Laws designed to apply regardless of delivery mechanism (digital vs. traditional)

Innovation Areas Under FMA Supervision

1. Algorithmic Trading — Monitoring automated trading systems for market manipulation and systemic risk
2. Robo-Advisory Platforms — Assessing digital investment advice systems for compliance with financial adviser standards
3. Open Banking/Open Finance — Developing regulatory frameworks for data-sharing and API-based financial services
4. Distributed Ledger Technology (DLT) — Evaluating blockchain settlement systems and DLT-enabled securities
5. InsurTech — Supervising digital insurance distribution and underwriting platforms
6. Embedded Finance — Addressing financial products integrated into non-financial platforms

Regulatory Guidance

The FMA publishes regulatory guidance documents addressing:

• Digital financial service provider obligations
• Cybersecurity and data protection requirements
• Anti-money laundering application to digital asset platforms
• Technology risk management standards

Payments and Money Movement Relevance

The Financial Markets Authority (FMA) — New Zealand has the following relevance to payments and money movement in New Zealand:

Payment Systems Governed or Overseen

The Financial Markets Authority (FMA) — New Zealand has the following relationship to payment infrastructure in New Zealand:

This entity's role in payment systems is primarily regulatory and supervisory rather than operational. It does not directly operate national payment infrastructure but contributes to the regulatory framework governing payment activities in New Zealand.

Relationship to Other Regulators

Multilateral Regulatory Networks

The FMA participates actively in international financial regulatory coordination:

International Organizations

• International Organization of Securities Commissions (IOSCO) — Founding member; contributes to global securities regulatory standards
• Financial Action Task Force (FATF) — Participates in AML/CFT standard-setting and mutual evaluations
• Asia-Pacific Economic Cooperation (APEC) — Engages in regional financial regulatory alignment
• Pacific Island Forum (PIF) — Coordinates regulation with neighboring Pacific jurisdictions

Bilateral Cooperation

The FMA maintains Memoranda of Understanding (MOUs) and information-sharing agreements with regulators in:

• Australia (ASIC — Australian Securities and Investments Commission)
• United Kingdom (FCA — Financial Conduct Authority)
• United States (SEC, CFTC)
• European Union member states
• Regional Pacific island financial authorities

Cross-Border Enforcement

The FMA:

• Investigates cross-border market manipulation and fraud affecting New Zealand markets
• Cooperates in mutual legal assistance with overseas regulators pursuing misconduct
• Shares investigation findings under formal information-sharing agreements
• Coordinates enforcement actions affecting multinational financial services providers

International Standards Compliance

The FMA ensures New Zealand's financial market regulation complies with:

• IOSCO Principles for Securities Regulation
• FATF 40 Recommendations on AML/CFT
• Financial Stability Board (FSB) recommendations
• Basel Committee standards (via Reserve Bank for prudential regulation)

Geography and Jurisdiction Notes

Important Departments and Divisions

Key Public Resources

Official Contact Information

Postal Address:

Financial Markets Authority

PO Box 1179

Wellington 6140

New Zealand

Physical Address:

Unisys House

1 Grey Street

Wellington

New Zealand

Telephone:

• General Inquiries: +64 (0)3 962 2695
• Freephone (within NZ): 0800 434 566

Email:

[email protected]

Official Website:

https://www.fma.govt.nz/

Leadership

Chief Executive Officer:

• Samantha Barrass — Chief Executive, with extensive international regulatory experience including prior role as Chief Executive of the UK Business Banking Resolution Service

Board Chairman:

• Craig Stobo — FMA Board Chairman

Board Members (as of 2025):

• Suzanne Chetwin
• Prasanna Gai
• Tracey Berry
• Nick Hegan
• Mariette van Ryn
• Steven Bardy
• Christopher Swasbrook

Executive Leadership Team:

• Clare Bolingford — Director, Regulatory Functions (licensing, engagement, supervision)
• Liam Mason — [UNVERIFIED: Executive Director, Operations]
• Louise Unger — [UNVERIFIED: Executive Director, Market Conduct]
• Daniel Trinder — [UNVERIFIED: Executive Director, Enforcement]
• Kari Jones — Executive Director, Transformation and Operational Delivery

Key Resources

Regulatory Guidance & Policy:

• FMA Enforcement Policy
• All FMA Legislation Overseen
• Regulatory Approach
• Financial Services Guidance
• Consumer Information

Crypto-Asset Guidance:

• Crypto-Asset Service Providers Page
• Tokenization in Financial Markets Discussion Paper

News & Updates:

• FMA News & Insights

Notes on Naming and Language