Law firm rounds up IFAs for FSCS challenge
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Law firm Regulatory Legal is garnering the support of IFAs to challenge the Financial Services Compensation Scheme’s £70m interim levy.
The campaign group will analyse the validity of the FSCS’s decision and see if there are adequate grounds look to pursue a judicial review against it. Partner Gareth Fatchett (pictured) says nearly 300 firms have so far signed up to get further information.
Earlier this month the FSCS announced it would be imposing a £70m levy on the 6,500 firms operating as investment intermediaries to pay for claims relating to Keydata, and stockbrokers Pacific Continental and Square Mile.
Keydata was classed in the investment intermediation sub-class for FSCS purposes despite being widely perceived as a structured product provider.
Firms with less than five registered individuals wishing to join the group must pay £200 plus VAT while those with more than five RIs must pay £300 plus VAT.
Regulatory Legal will assess the group’s viability at the end of the week commencing March 15. If there is not enough support it will return all monies to firms in early April.
Fatchett says: “Our firm is dedicated to giving IFA firms the opportunity to challenge the FSCS levy decision.”
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Readers' comments (37)
Experienced IFA | 23 Feb 2010 10:37 am
Sorry to be a spoil sport I wouldn't give him my money. I've sat in court rooms listening to other cases where it goes above judges heads with no result apart from laywers fees. Try lobbying with MPs.
IFA for 30 years
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Evan Owen | 23 Feb 2010 10:55 am
Look before you leap folks.
There is a lot going on behind the scenes that you don't know about.
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Richard Smith | 23 Feb 2010 10:56 am
Here is the pitch, give IFA's a little hope and take some of their money, when it fails at least they can say they tried.
My suggestion would be to take all of the money, spend it on some marketing and client development.
With the money you will earn from this activity you will be able to fund the increase in the levy and with some careful future nurturing of these clients you have just done business with pick up some nice future work.
The last thing this industry needs is someone else offering hope especially hope that is as vague as this.
Hope remember is not a plan.
Richard Smith IFA and Tech Consultant
http://www.theinternetconsultancy.com
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Peter Davies | 23 Feb 2010 10:59 am
Well done the firms who have signed up to Regulatory Legal's proposed challenge. Why should advisory firms have to cover the costs of a provider and a stockbroker; it just doesn't seem reasonable and neither would it happen in virtually all other professions. If Sainsury's for example went under would Tesco, Morrison's and Asda have to pay for any compensation claims made against Tesco....I think not. They would take their competitors market share which is exactly what other product providers will do after KeyData's demise and it is they who should pay an increased levy not the advisers who have recommended their products.
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Richard Smith | 23 Feb 2010 11:03 am
In response to Peter Davies
If only we lived the same world as every other kind of business.
Fact is we don't, and nor will we.
Back to my earlier point, suggest we focus elsewhere, like a battle that is actually win-able (is that a word).
Richard Smith IFA & Tech Consultant.
http://www.theinternetconsultancy.com
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Experienced IFA | 23 Feb 2010 11:12 am
I fully support Richard Smith's comment re the misguided Peter Davies. Fatchet will benevr win for the 2 reasons mentioned above.
Many of us have been through this before and no longer live in hope but want real results. What a waste of money this should be going to Adviser Alliance as they have IFAs interest at heart and not the main chance!.
IFA for 30 years
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Steven Farrall | 23 Feb 2010 11:21 am
Re Richard Smith and other comments. This is not necessarily about raising false hopes. Every little attack made against Brown's Bonkers Regulatory system is worth doing in itself - as long as it is done well. If Mr Thatchett chips a bit more off this structure, well done him. And as far as wasting money goes it is entirely down to an individuals judgement whether backing Mr F - or anyone else is a waste of money.
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Tony Dunsdon | 23 Feb 2010 11:40 am
Regulatory Legal/Fatchett are in it to make money. They are not our guardian angels. A2O and FSA Levy. What's next to make some money on? We should be using our own representative bodies with no extra cost.
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Mr Smug | 23 Feb 2010 12:56 pm
I don't understand this. For the past week I've been reading posts by IFA's feeling (rightly) that they are being tucked up by FSCS.
Here comes someone prepared to take them on for a relatively modest fee and everyone posts 'they're in it for the money'. I realise that Mr F. is no charity but I think he at least gives us a fighting chance.
An action will also demonstrate IFA's working together and fighting. We have been a pushover for far to long.
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PensionMan | 23 Feb 2010 1:09 pm
I second Mr Smug.
I have been looking at past comments from IFA's when this story initially broke and the overwhelming concensus is that someone should stand up for IFA's.
Now someone is and you are moaning??
I appreciate that your representative bodies should be standing up for you but they appear to have the lack of backbone and will to do anything about this!
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