New Zealanders are being warned by the Financial Markets Authority (FMA) to exercise “extreme caution” before obtaining any financial services or acquiring financial products from building society General Equity.
The FMA, which regulates the country’s financial markets, has also ordered General Equity to publish the warning prominently on its website.
In its warning, the FMA said General Equity had “engaged in conduct and has made statements that are misleading and deceptive in connection with its status as a financial markets participant and how it is regulated in New Zealand”.
The warning went on to say the misleading and deceptive statements were made in connection with The General Equity Asset Builder Fund No 1.
“In FMA’s view, the ABF1 does not hold the assets General Equity claims it holds and was used by General Equity to give a misleading impression of adequate asset backing to support the issuance of letters of credit by General Equity,” the warning said.
In a prepared statement, the FMA said General Equity had not issued shares to the public and it was not aware of any Kiwis suffering a loss.
“However, given General Equity’s past conduct, we consider that anyone dealing with General Equity should exercise extreme caution.”