Woodall says act now on charging

21 October 2011 8:00 am | By Natalie Holt

The FSA has warned advisers not to delay the move to adviser-charging, saying it could be the most challenging element of the RDR.

Speaking at a Personal Finance Society RDR seminar in London last week, FSA head of investment intermediaries Linda Woodall said the regulator is concerned some firms have not yet started to transition to adviser-charging. She said: “It is safe to say that implementing a suitable adviser charge has the potential to be the most challenging element of the RDR.

“We have spoken to firms who have moved to an advisercharge proposition already and they have told us that it does not happen overnight. It takes time to put together a proposal, communicate the change to clients and test it. In some cases, firms have had to test two or three different models, so please do not take these changes lightly. Putting off this work involves a huge risk.”

Woodall also said advisers do not need to recommend unregulated collective investment schemes to maintain their independent status.

She said: “We expect Ucis to be suitable for very few of a typical adviser’s clients, if any. An adviser’s independent status will not be impacted if they never sell these products because they deem them to be unsuitable for their clients.”

Woodall said the FSA will continue to monitor firms selling Ucis and will take enforcement action against firms selling the investments inappropriately.

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