Dalziel lines up Blue Chip advisers
Friday 11 April 2008
Commerce minister Lianne Dalziel has finally stepped in and criticised the so-called advisers who sold Blue Chip properties. She has acknowledged, in a speech this week, that these people fell outside the more regulated advice industry and hadn’t acted with sufficient care.
“Although real property sits outside the definition of securities, it would seem that none of the Blue Chip salesmen and women were licensed real estate agents and some of them as former insurance salesmen and women were known to their investor group and were therefore trusted to know more than they did.
“Just because they lost their own money by investing in Blue Chip themselves does not let them off the hook for advising clients to invest money in the way many of them did and without the normal checks and balances a professional should have ensured.”
Dalziel says they “owed a duty of care to their clients” and it is no excuse that they didn't do the basic due diligence for themselves either.
Dalziel also made it clear “that ultimately the responsibility for financial decisions and risks lie with the individual decision maker.”
I confess that I do not understand why people who have spent their lives working hard to save their money can invest in products without doing the same level of hard work and taking independent professional advice.
She was also critical of “some of the advocacy groups and individuals, who are representing those who have invested in some of these failed investment vehicles, are raising expectations that government can remedy those failures when we cannot.”
While she didn’t name anyone it appears she was referring to EUFA.
“Although I haven't had an explicit request from these groups other than to "freeze" everything, it seems that they want to identify those who are to blame for their members losing money and make them pay it back.’
She says there are “civil and criminal remedies that deal with those who are culpable in this way.”
Dalziel said there were lots of investigations going on into failed investments such as Blue Chip and some of the finance companies and that she was sure where there was fraud there would be prosecutions.
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