The Financial Markets Authority (FMA) won't say whether it plans any further action against registered New Zealand company Vivier after publishing a warning about Vivier overplaying its relationship with NZ.
The FMA points out Vivier and Company Ltd isn't a registered financial service provider in NZ and nor is it regulated in NZ. In fact the FMA had Vivier removed from NZ's Financial Service Providers' Register (FSPR) five years ago, ultimately through a Court of Appeal decision. The FSPR is a searchable register of individuals, businesses and organisations that provide financial services in NZ.
In the warning, published on its website, the FMA says it's concerned that materials and information published by Vivier on the internet and on its website have the potential to mislead investors that Vivier provides financial services in NZ or from NZ.
Vivier remains, however, a NZ registered company under the oversight of the Ministry of Business, Innovation & Employment's Companies Office. And Vivier's website promotes banking type services including the taking of deposits, even though it's not a registered bank or non-bank deposit taker, both of which are supervised by the Reserve Bank.
Vivier meets Companies Office requirements that NZ companies must have at least one NZ or Australian-based director. Currently this is Christchurch man John Johns. His Ilam Road office is listed as Vivier's address for service and registered office.
In April interest.co.nz reported on a bitter dispute between Vivier and a registered NZ foreign trust over a $4 million investment the Trust placed with Vivier, which it's alleged is controlled by shadowy convicted British fraudster Ian Andrews, formerly Ian Leaf. Interest.co.nz has also been contacted by disgruntled overseas Vivier investors, or their representatives, notably in Spain and Japan. Complaints from overseas investors may be a factor in the FMA issuing its warning.
The FMA says the Court of Appeal decision noted Vivier doesn't provide financial services in NZ or from a place of business in NZ.
"We also note that statements that claim Vivier is supervised by the Financial Markets Authority are present on its website. We are concerned these statements have the potential to mislead investors on the extent to which New Zealand’s financial markets legislation apply to Vivier or the extent to which Vivier’s operations in New Zealand are regulated."
"We note that Vivier is not a registered financial service provider in New Zealand and is not regulated in New Zealand," the FMA says.
"The FMA is also concerned that statements on Vivier’s website have the potential to misleadingly inflate the extent to which investors and their investments are protected by virtue of Vivier being incorporated as a company in New Zealand. Being incorporated as a company in New Zealand provides a framework of rules and requirements that offers corporate regulation and not operational regulation."
"Despite having been de-registered from being a financial service provider in New Zealand since 2016 and knowing clearly that Vivier is not and was never supervised by the FMA, Vivier has failed to remove and update its website(s) and online publications that contain obsolete, false and misleading information," the FMA says.
"It is the responsibility of entities to ensure all its online publications are accurate and not misleading. Failure to do so can be viewed as a deliberate act to mislead investors. FMA is of the view that Vivier has failed."
The FMA has previously taken legal action against NZ registered but overseas operating financial service providers it has deemed to have misleading information on websites. Notably it did so against Pegasus Markets.
Michael Reps, the NZ based director of former NZ registered financial service provider Pegasus, was in March sentenced to community detention and community work after being found guilty of two breaches of the Financial Service Providers (Registration and Dispute Resolution) Act (FSP Act). This means Reps can't be a director of a NZ financial services provider for five years. Pegasus Markets itself, registered in NZ but promoting foreign exchange services overseas, was also found guilty of two charges and fined $200,000 last December.
Asked by interest.co.nz whether the FMA is taking, or considering taking, any further action against Vivier, and if so what, an FMA spokesman declined to comment.
"We cannot comment on your query," the FMA spokesman said.
Vivier and Johns are yet to respond to requests for comment.
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A Ministry of Business, Innovation & Employment (MBIE) spokesman says monitoring of Vivier by MBIE’s Integrity and Enforcement Team remains ongoing.
"Should any information regarding non-compliance with the Companies Act become available, the matter will be reviewed in accordance with the Integrity and Enforcement Team’s enforcement policy guidelines," the MBIE spokesman says.
Following the 2016 Court of Appeal ruling the FMA noted the court found the ability to remove firms from the FSPR was intended to allow the regulator to assess potential damage to the reputation of NZ’s financial markets and the misleading appearance of registration. The FMA went on to say the court had concluded that, in the case of Vivier, there was an absence of any material financial services provided in or from NZ, and agreed that the FMA was entitled to infer potential harm from this, and to direct Vivier’s deregistration from the FSPR.
Also following the Court of Appeal judgment Luigi Wewege, Vivier's then-CEO, told interest.co.nz Vivier could continue doing what it did, just without being a registered NZ financial service provider.
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