The FMA’s $270,000 exit deal would fail its own disclosure test

The Financial Markets Authority spends its working life telling directors that disclosure is not optional. Asked to explain how it parted ways with its own suspended chief executive, it has offered almost nothing.

Samantha Barrass resigned with immediate effect on 3 September. An Official Information Act request by the NZ Herald has now established that her payout equalled what she would have earned through to her contract end date of 24 January 2027. On a salary of $640,000 to $650,000, the Herald estimates that comes to about $270,000. The FMA also covered all her legal costs, but won’t say how much, and won’t release the settlement terms.

What the money actually bought

The sequence matters. In July, MBIE began investigating workplace culture and conduct at the FMA and Barrass was put on leave. A separate employment investigation into Barrass personally, led by Paul Wicks KC, ran alongside the wider review, according to RNZ. Barrass then moved to overturn her suspension ahead of an Employment Relations Authority hearing.

The exit deal resolved all of that neatly. Barrass got the FMA to drop the Wicks investigation, folding it into the broader culture probe now led by Kristy McDonald KC, and the regulator paid £18,500 (NZ$44,000) for her to attend a UK governance conference after her resignation had already taken effect. The FMA says it has no information that she received any pardon or concession. A specific investigation into a specific person was closed as part of her leaving. Taxpayers are entitled to wonder what else that is.

A conference for a job that was always ending

The conference spend is the detail that should sting. It was originally justified as career development. But Barrass’s tenure was always going to finish in January. Developing the career of a chief executive who has already left, at a governance event no less, is the sort of expense the FMA would want explained if a listed company’s board signed it off.

This was never just an HR story

BusinessDesk’s reporting in September painted a regulator with deeper problems. A prior restructuring cost $1.7 million, including more than $800,000 in redundancies, drove out experienced staff, and culture issues were handled by shifting reporting lines rather than dealing with bad behaviour. One fund manager put the market consequence bluntly: “I’m not that scared of the FMA”, adding that a regulator should be feared because wrongdoing gets punished.

On her way out, Barrass said “We have lifted the performance of the organisation”. NBR called that claim a rewriting of history given she left amid live investigations. NBR has the better of that argument.

Nobody built the watchdog’s watchdog

The deeper fault is structural, and it predates Barrass. Roger Partridge of The New Zealand Initiative argued in August that effective oversight needs three parts: a board that holds management to account, an independently scrutinised process for choosing board members, and someone independent checking whether the regulator does its job. Parliament built only the first for the FMA in 2011. “The second and third parts were never built,” he wrote. Britain and Australia have versions of both. New Zealand has neither.

The Initiative’s 2022 survey found only 21.8 per cent of businesses thought anyone holds regulators to account when they perform badly. The Barrass exit is what that gap looks like in practice. The board that was meant to hold management to account negotiated a confidential deal and is now declining to explain it.

What directors should take from this

For fund managers, advisers, issuers and their boards, the read is uncomfortable. The agency that scrutinises your remuneration disclosures, related-party dealings and board processes will not apply the same standard to itself under the OIA. That does not excuse anyone from compliance. But it does weaken the FMA’s moral authority at exactly the moment it needs to rebuild credibility with the market it supervises. A regulator that is neither feared nor transparent is the worst of both worlds.

The open thread is the McDonald investigation, to which Barrass has committed to contribute. Whether that commitment means much now that the probe into her personally has been dissolved remains unresolved. The FMA board should publish the settlement terms and the legal bill, and Parliament should finally build the two-thirds of the oversight system it skipped. Otherwise, as Partridge put it, we will keep learning how our regulators perform by reading about it in the newspapers.

Sources

• NZ Herald: Former Financial Markets Authority CEO Samantha Barrass gets big payout after quitting amid investigations (2026-10-30)
• RNZ: Financial Markets Authority chief executive Samantha Barrass quits (2026-09-03)
• BusinessDesk: Inside the crisis at the Financial Markets Authority (2026-09-06)
• The New Zealand Initiative: The two-thirds we never built (2026-08-21)