Legal Obligations in Financial Advice: Applying Legal Obligations to Hypothetical Case Studies

Task 1 - Case study 1: Aotearoa Insurance

Apply legal obligations in a financial advice situation.  You must submit your work through the assignment submission link in the course. Upload your assignment, then use the ‘Save’ and ‘Submit assessment’ buttons – or we will not receive your assignment. You will get an electronic receipt and your work is then logged and tracked through our system. Open Polytechnic will not accept assignments emailed directly to lecturers.
Student Instructions

1. This assignment covers three hypothetical case studies that require you to apply legal obligations to a financial servicessituation.
this assignment on the Assignment 1 page.
You are required to answer all three tasks.
The topics covered in this assessment are:
• Task 1 – Case study 1: Aotearoa Insurance
• Task 2 – Case study 2: Aotearoa Bank
• Task 3 – Case study 3: Licensing
You will be assessed on your overall presentation. Each answershould be presented in a professional manner. This means:
• Minimal spelling and grammatical errors.
• Written in terms that an audience with little financial knowledge will understand.
For each task, we have provided you with a suggested word count. Note that the word count is for guidance only and you will not be penalised
for being under or over the suggested word count, provided you fully answer the task.

Task 1
Read through case study 1 (Appendix 1) before attempting this task.

a) Regulated financial advice Does David give regulated financial advice in this situation? Give reasons for your answer. You are required to:
• State whether or not David gives regulated financial advice in this situation.
• Cite and explain the relevant section(s) of the Financial Markets Conduct Act 2013 that supports your view.
b) Privacy Act 2020 David collects personal information from Kate. Does he collect this personal information in accordance with the privacy principles?
You are required to:
• Identify the four privacy principles that cover the collectionof personal information.
• For each of the four principles, illustrate, with reference to the case study, whether David complies with each principle.
c) Optional benefit – hiring a car Kate is adamant that she made it clear she needed cover for the cost of hiring a car. Her comments suggest that Aotearoa Insurance may have breached consumer legislation. Which Act may it have breached and how?
You are required to:
• Identify the Act that Aotearoa Insurance may have breached.
• Cite the two key sections of the Act that may have been breached.
• Explain why these two key sections may have beenbreached.
d) Human Rights Act
Kate accuses Aotearoa Insurance of discrimination. Is there any evidence that Aotearoa Insurance has practised discrimination in its dealings with Kate?
You are required to:
• State whether or not Aotearoa Insurance has practised discrimination in its dealings with Kate.
• Justify your decision with reference to the relevant section(s) of the Human Rights Act.
e) Complaints
Does David apply the correct process for handling complaints? You are required to:
• State whether or not David has followed the correct processfor handling Kate’s complaint.
• Justify your decision with reference to Aotearoa Insurance’s obligations as a member of the Insurance and Financial Services Ombudsman Scheme.
Task 2
Read through Case Study 2 (Appendix 2) before attempting this task.

a) Regulated financial advice Does Serena give regulated financial advice in this situation? Give reasons for your answer.
You are required to:
• State whether or not Serena gives regulated financial advice in this situation.
• Cite and explain the relevant section(s) of the Financial Markets Conduct Act that supports your view.
b) Anti-Money Laundering and Countering Financing of TerrorismAct 2009 (AML/CFT Act) Serena tells Chris she needs personal information and documentation from him to satisfy Aotearoa Financial Planning’s’ obligations under the  AML-CFT Act. Whatare these obligations?
You are required to:
• Identify the appropriate customer due diligence requirements in this situation.
• Explain the personal information and documentation Serena needs to meet those obligations.
• Cite the sections of the AML/CFT Act and Amended Identity Verification Code of Practice 2013 that apply in thissituation.
c) Financial Markets Conduct Act (FMCA)(Part 2) and Fair Trading Act (FTA)
In the process of checking if Chris understands how KiwiSaver works, Serena avoids a potential breach of the FMCA (Part 2) and the FTA.
• What is this potential breach and how does she avoid it? You are required to:
• Explain the potential breach, and cite the specific section of the FMCA (Part 2) and the specific section of the FTA that apply.
• Identify the action Serena takes to avoid the potential breach.
• If there had been a breach, which regulator would most likely hear the case?
• State which regulator would most likely hear the case.

• Explain the arrangement between the two regulatorsof the FMCA (Part 2) and the FTA for hearing cases.