Financial Markets Authority warns punters over Property Tutors Ltd seminar offer to investors' with no income
The Financial Markets Authority (FMA) has issued a warning to potential property investors with no income, who are being encouraged to attend property seminars run by Property Tutors Limited, telling them to get legal and financial advice.
In a statement FMA chief executive Sean Hughes said the warning is a response to newspaper advertisements from Property Tutors, whose sole shareholder and director is listed as Sean Wood, that invite investors who have “no or minimal income” to attend seminars with the promise they'll learn “systems” to obtain loans to fund investment in property.
Hughes said investors ought to fully understand the costs of property ownership and debt servicing, market fluctuations, and the risk of losing assets used as security.
"The FMA encourages anyone thinking about taking on debt for investment purposes to obtain independent legal and financial advice from a registered or authorised financial adviser," said Hughes.
"The Financial Advisers Act obliges all advisers to act with care, diligence and skill, and investors should be able to expect competent and prudent advice from anyone who is advertising services as a Registered Financial Adviser."
Property Tutors' website says Wood, apparently known as "The Fifteen Million Dollar Man" by his peers, is a registered financial adviser. The firm's other tutors are listed as "Mr Property" Steven Goodey who is also a registered financial adviser, Grant Hoey and Steve Starke.
8 Comments
.... yeah , but where's the problem with zero income owners buying property ? ..... if the property earns a rental return above the costs and the mortgage payments , she's all sweet , mate !
Properties in Godzone do earn a decent rental return don't they , Wolly ?
There is a big difference between a Registered financial adviser and an Authorised financial adviser. A registered financial adviser (RFA) can only give a limited advice on very simple investments. An authorised financial adviser (AFA) can give advice on anything from shares, to money management, to property advice etc etc.
Anyone who gives financial advice including how to buy property with no money down, or advises people on which property to buy or not to buy, is likely breaking the law and could face hefty civil and criminal charges plus fines of many hundreds of thousands of dollars.
The FMA warning is timely and should be noted. Anyone seeking advice on property matters or any financial investing should only deal with AFA's
I'm sorry BigDaddy but your not quite right there.
A QFE, RFA, AFA or an unregistered "Property Educator" can give advise on Direct Property investments without being outside the rules.
Direct Proeprty investment has been ruled as not being a Financial Product as apposed to Unitised Property trusts and perportional share properties which are a Grade 1 Financial product.
So your final line "The FMA warning is timely and should be noted. Anyone seeking advice on property matters or any financial investing should only deal with AFA's" is In my opinion good advise but it's not entirely correct.
But then the people who are behind this company in question are in fact RFA's and AFA's and so I would actually question the value of the FMA's press release.
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