Royal Commissions just killed MOC, page-67

This proposed legislation and change is incredibly disruptibve to this industry and has the power to destroy it - there is no sugar coating here guys....

If you back to the dawn of Mortgage Broking it was at the start a very cottage industry with very few participants whe WERE then charging for their services as banks didn't pay trails. In fact the first product to do this was the MLC Building Society where they introduced this as well as re-draw facilities (both revolutionary for their time), prior to that BNZ was really the primary bank working with this small number of brokers. It was a little different for leases and more sophisticated lending and commercial deals but outside of motro vehicle lending everything was on a seperate arrangers fee basis. This was circa late 80's.

Transport yourself to today (circa 30 years on) and finance and mortgage broking is an established industry with a significant number of livelihoods depending on its survival. I believe it definitely should have some tighter regulations applied and some weeding out but the real problems lie further up the food chain with the big institutions. They have been the suppliers of the herion and incentivated the bad behavious and allowed bad participants to operate whilst they turn a blind eye (and watch the cash register keep ringing)

There is no doubt in my mind that history will repeat itself (it always does with money and greed) and the real winners here will be less choice, worse client outcomes and the banks will win with their un-deserved protected species status in this country.

The banks have and will continue to treat the end client like mushrooms (keep them in the dark and feed them sh*&t and they will thrive). The will love the death of commissions - regulatorialy outlawed and yet no where is it regulated that the banks have to pass these explicit savings back to the end customers (ie. drop their rates equivelantly) - isn't that "Fee for no service" all over again..............

The other thing they will love here is the death of the broker - this means back to the good ol days of "one stop shop" without peskie upstart brokers gaming the clients off to the "best deal in town" or dare I say it in a number of cases "best commsiion in town". There is plenty of evidence showing that the broker deal flows were and have been heavilly influenced by either the rate being offered to the client and/or the rate being paid to the broker - not much in the middle if you do your research.IMO the only winner I see here are the banks - regardless of what ones opinion is of the value brokers do or dont deliver.

They will continue to display their same old pervasive behaviour and hide it ambiguous rhetoric and marketing spin accordingly with quotes like "client first", "Customer Centric",etc etc....They are totally conflicted being publicly listed entities in that their BOD's live and die by the company results and S/H's, brokers and Fund Managers want yeilds and capital growth so who pays for this (heard the terms recently "greater share of customer wallet", "vertical integration" ??). More products, more clips of the ticket. Credit card fees, Account Keeping Fees, and International Cash Transfers are excellent examples of their egregious behaviour and pathetic and totally falacious justification of these fees - all can and should be banned as they are a blatant client rip off.

From my side - I believe an evergreen commission system for loans was not a symetric outcome for the client as someone had to pay for it and it ultimately is the customer and that ongoing commision compounds to a lot more than what they would have paid for straight up advise. I do however think the industry needs independent advisers in this space so the regulation needs to be re-addressed as they are throwing the baby out with the bathwater here.