NZ regulator issues interim stop order to Validus
New Zealand’s Financial Markets Authority (FMA) has today issued an Interim Stop Order to Delaware-registered Validus International LLC, pursuant to section 465 of the Financial Markets Conduct Act 2013.
While this Order is in force, Validus and its associated persons are prohibited from making offers, issues, sales or other acquisitions or disposals of financial products promoted under the brand or name Validus.
The company and its associated persons are also prohibited from accepting applications for financial products promoted under the brand or name Validus, as well as from distributing any restricted communication that relates to:
- the offer, or intended offer, of financial products promoted under the brand or name Validus; and/or
- the supply, or possible supply, of a financial advice service to any person.
The regulator has also banned Validus and its associated persons from:
- accepting further contributions, investments, or deposits in respect of financial products promoted under the brand or name Validus; and
- supplying a financial advice service to any person; and
- supplying the financial service of keeping, investing, administering, or managing money, securities, or investment portfolios on behalf of other persons.
The FMA considers that making the order is in the public interest because there is real risk of investor harm arising from activities of Validus and its associated persons, that appear to be dishonest and misleading and not to comply with the Act or the regulations made under the Act.
The FMA reinforces its warning that the public should exercise caution in dealing with this company and its associates. The FMA also encourages people to come forward with any complaints or information about this entity, especially if they have made contributions, investments or deposits to this company and its associates, at this contact. All information is treated in confidence.
The FMA is considering whether it may exercise a power (to issue a full stop order) under section 462 of the Act.
Following the interim stop order Validus will now be aware that communications at marketing events will be a restricted communication (as defined in section 464 of the Act) where they:
- directly or indirectly refer to an offer, or intended offer, of financial products (namely a managed investment product promoted under the brand or name Validus) or the supply, or possible supply, of a financial service (namely a financial advice service);
- are reasonably likely to induce persons to apply for financial products (namely a managed investment product promoted under the brand or name Validus) or request the supply of a financial service (namely a financial advice service);
- are authorised or instigated by, or on behalf of, offeror, the service provider or an associated person of the service provider (namely Validus); and
- are to be distributed to a person (being attendees at the marketing event).
The FMA is cooperating with the Commerce Commission on these matters.