For anyone looking to get into Forex trading, finding a reliable and trustworthy broker is of the utmost importance. For New Zealand traders, this can be a bit of a challenge because market regulation is somewhat loose. However, registering with one of the FMA regulated brokers is a step in the right direction.
What is the FMA?
The Financial Market Authority (FMA) is the New Zealand’s top organization in charge or regulating the financial market. They inherited the role from the Securities Commission of New Zealand, which faced a lot of criticism in the 2006 – 2010 period. The Commission had hard time enforcing strict regulation which would provide good protection for the customers.
In 2011, the FMA was formed with the goal to put an end to this and finally bring some proper order in the financial market. They took on many responsibilities, including Forex brokers. The new financial bill passed that year gave the FMA the power to issue and revoke licenses for financial companies, supervise their work, and regulate their business conduct.
In 2014, the FMA’s domain was expanded thanks to new Act passed in 2013. This gave the organization more tools and options to provide for safer environment for everyone involved with the market.
FMA Forex Brokers
After the FMA was introduced in 2011, the government tried to give them what they needed to repair the New Zealand reputation regarding financial dealings. This reputation has been tarnished by several scandals and mishaps which saw a significant number of people financially damaged.
FMA regulated brokers were an important part of the equation. Formerly weekly regulated market where people could get away with almost anything has become much more supervised and the companies that wanted to continue offering their services had to adhere to certain international regulations and code of conduct.
All FMA Forex brokers are under constant scrutiny from the organization to ensure their business is conducted fairly, responsibly, and with an emphasis on the customer. Although the FMA still has problems keeping track of everything and there are things that slip through the cracks, FMA regulated brokers are still the New Zealanders’ best choice.
Advantages of FMA Regulated Brokers
The 2011 reform saw a number of already registered business lose their licenses. While the FMA issued licenses to newly created companies, including Forex brokers, which complied with the new regulation, old firms got caught in the crossfire.
Some of these companies were conducting legitimate business, so they were naturally not happy with this new development. After some back and forth, the FMA established a process for these old business to apply for licenses, but they all had to comply with newly established rules and regulations.
Thanks to this, all FMA Forex brokers were made accountable for their business conduct. Failure to comply with rules can bring with it big fines and, in most extreme of cases, even a loss of license. This was an important step ahead in comparison to the past where rogue companies had pretty much free reign to do whatever they liked.
In the event one of the FMA regulated brokers behaves contrary to the regulations, clients are invited to lodge their complaints with the organization. Customers can contact the FMA via various channels and once the complaint is received, they will act to the best of their abilities to investigate the allegations and will proceed to punish the culprits accordingly.
Other FMA Roles
Apart from acting as an intermediary in cases of complaints and establishing the rules, the Financial Market Authority also tries to act preventively. They perform regular audits of the FMA regulated brokers and other companies under their authority. These audits serve to detect and prevent any irregular behavior by the businesses and increase consumer protection.
They constantly try to educate investors about the financial market, helping them make the best decisions about how to handle their money and who to trust. The list of blacklisted brokers is available on the FMA site as well, ensuring you don’t get entangled with a wrong company.
Unlike many brokerage firms out there who only want you to deposit the money, the FMA actually wants people to learn the investment game and enter it with as much knowledge as possible. Finding a reliable FMA Forex broker is not enough on its own: you also need to know what you are doing or you will be endangering your financial assets.
They set their eyes on the bigger picture, trying to do away with the bad reputation that New Zealand had acquired during the early and mid 2000’s. By doing everything in their power to prevent money laundering, unethical business conduct, and rogue companies taking advantage of people, they hope to create a safe and strong business environment.
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The FMA and Other Agencies
In their efforts to achieve the earlier mentioned goals, the Financial Market Authority cooperates with other New Zealand and international organizations. Coordinating their work with the Department of Internal Affairs, Commerce Commission, and Serious Fraud Office, they try to achieve a full-fledged control over the financial market.
The cooperation on this level is crucial because financial market is really huge and very volatile, which makes tracking all activities quite complicated. By exchanging relevant information, the FMA tries to cover as much ground as possible and always stay on top of things.
FMA regulated brokers are the best choice for people from New Zealand involved in Forex trading. The Financial Market Authority makes sure that all companies on the market follow certain rules and procedures in their business activities, always putting consumers’ needs and safety ahead of everything else.
By coordinating their work with other relevant bodies and doing their best to keep the investors informed and help them learn the ropes, the FMA strives to create a safe and stable business environment in New Zealand. It is thanks to this commitment that you can rest assured that FMA Forex brokers are compliant with regulations and don’t get involved in unethical business practices.
In the uncertain world of Forex trading, staying safe is the utmost priority and one of the most important steps in that process for New Zealand traders is finding reliable and accommodating FMA regulated brokers.