Securities Commission of New Zealand

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Securities Commission
Agency overview
Formed 1978
Dissolved 30 April 2011
Superseding agency Financial Markets Authority (New Zealand)
Headquarters Wellington, New Zealand
Employees 51 [1]
Agency executive Jane Diplock, Chairman (2001 - 2011)
Key documents Statement of Intent 2009-2012
Annual Report 2009

The Securities Commission was an independent Crown Entity of the government of New Zealand and the main regulator of investments. It was replaced on the 1 May 2011 by the Financial Markets Authority (New Zealand).

It was responsible for enforcement, monitoring and market oversight of the securities markets, authorising participants and promoting public understanding of investments. This includes authorising the New Zealand Stock Exchange with which it runs a co-regulatory model.

On 27 April 2010 the New Zealand minister for commerce Simon Power announced that Securities Commission would be replaced by a new integrated financial regulator the Financial Markets Authority.[2]


The Commission was first established under the Securities Act 1978 which determines its powers and functions.

The commissions role was modified and extended by a number of additional pieces of legislation. These include the Securities Markets Act 1988, the Investment Advisers (Disclosure) Act 1996, the Securities Regulations 1983, the Securities Act (Contributory Mortgage) Regulations 1988, and the Securities (Fees) Regulations 1998.

The Financial Advisers Act 2008 gave the Securities Commission new responsibilities to register and set minimum standards for financial advisers. There was some concern that the commission did not have the resources to effectively carry out its responsibilities [3] and that this additional responsibility would make the situation worse.

The agency was chaired by Jane Diplock from 2001 until it was disbanded in 2011 and faced criticism for its handling of the collapse of a large number of finance companies.[4] Jane Diplock was also the chairperson of the International Organization of Securities Commissions (IOSCO) during her time as chairperson of the Securities Commission.

Responsibilities and functions[edit]

The Securities Commission undertook the following roles:

  • Enforcement, monitoring and market oversight
  • Law reform
  • Exemptions
  • Authorisations
  • International co-operation and
  • Promoting public understanding

Notable cases[edit]

  • In June 2007, Michael Fay and David Richwhite through one of the companies that they co-owned, Midavia Rail Investments, paid $20 million to the commission to settle insider trading proceedings relating to Tranz Rail. In October 2004 the commission accused Midavia of insider trading and Richwhite of tipping off Midavia to sell $63 million worth of shares while knowing Tranz Rail was facing financial problems, which was not known to the public. The commission noted that the payments had been made "without any admission of liability".[5][6]
  • On 20 June 2010, the Securities Commission put the finance company South Canterbury Finance which was run by Allan Hubbard into statutory management after complaints from a number of investors.[7] This also triggered an investigation by the Serious Fraud Office (New Zealand).[8] Eight weeks later on the 31 August 2010, South Canterbury Finance was placed in receivership.[9]

See also[edit]


  1. ^ 2009 Annual Report - Recruiting and retaining staff
  2. ^ Bennett, Adam (29 Apr 2010). "One financial regulator to rule them all". NZ Herald. 
  3. ^ Securities Commission needs staff, money and IT
  4. ^ "Diplock defends commission over fin coy failures". Good Returns. September 9, 2009. 
  5. ^ "Fay Richwhite money a hard sell". Fairfax NZ News. 24 April 2009. 
  6. ^ "Former Tranz Rail shareholders face insider trading charges". The New Zealand Herald. June 5, 2011. 
  7. ^ Power, Simon (20 June 2010). "Aorangi Securities, charitable trusts, and Hubbards placed into statutory management". New Zealand Government. Retrieved 11 April 2012. 
  8. ^ BusinessDesk (20 June 2010). "SFO to investigate Hubbards". The New Zealand Herald. Retrieved 21 October 2010. 
  9. ^ Hutching, Chris (31 August 2010). "Some big winners from South Canterbury collapse". The National Business Review. Retrieved 11 April 2012. 
  10. ^ NZPA (15 December 2010). "Hotchin assets frozen by High Court". New Zealand Herald. ISSN 1170-0777. Retrieved 21 December 2010. 

External links[edit]