This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. Find out more here.
X
MM-Cover-Top-140718.jpg
Categories:Advisers,Regulation

Aegon: FSA legacy ban wording will hit advice

  • Print
  • Comments (4)

Aegon has warned that the current wording of the FSA’s ban on legacy commission will penalise advisers focused on providing ongoing advice and undermine the aims of the RDR.

The FSA’s consultation on the treatment of legacy assets last November confirmed its intention to ban legacy commission despite widespread industry opposition. The FSA defines legacy commission as additional commission that may become payable on legacy assets where there has been a change or addition to the product or investment after the RDR.

Aegon has questioned the FSA about whether it is supposed to interpret the legacy ban as meaning that any advice on a pre-RDR policy given after December 31, such as switching funds, will halt all ongoing trail commission arrangements as well.

Head of regulatory strategy Steven Cameron says: “There has been a conscious shift by advisers looking to build a sustainable business model which remunerates them for ongoing services to their customers.

“If the FSA were to require future commission on excising assets to be switched off, it is those advisers who will be particularly penalised.

“We believe this would be particularly unfair as this move is inconsistent with the aims underpinning the RDR.”

Aifa director general Stephen Gay says: “A distinction should be drawn between switching within a packaged product and switching between products. If switching leaves a product intact and fundamentally unchanged, for example, after rebalancing within a pension, we believe that trail commission should continue because that product sold before the RDR remains.”

  • Print
  • Comments (4)

Daily Email Updates
If you enjoyed this article, sign up to receive the latest news and analysis from Money Marketing.

The Money Marketing CPD Centre
Build your annual CPD - you can log and plan your CPD hours for free with The Money Marketing CPD Centre.

Taxbriefs Advantage
Advantage is a digital reference source giving unbiased, independent, answers to your technical queries. Subscribe to Taxbriefs Advantage.

Readers' comments (4)

  • This FSA action is like boarding the Titanic,at this rate there will be no one left to pay the FSA's FAT salaries.

    Unsuitable or offensive? Report this comment

  • But will the FSA listen or will this be just another case of acceptable (acceptable, that is, to the FSA, if not to anybody else) collateral damage along the way to the Brave New World of 2013 onwards?

    Unsuitable or offensive? Report this comment

  • What's it all about, alfie?

    Unsuitable or offensive? Report this comment

  • Not a lot of people know Evan

    Unsuitable or offensive? Report this comment

Have your sayEdit my profile/screen name

You must sign in to make a comment

The Cost of Advice

Sponsored by Brooks Macdonald

Fund Data

Editor's Pick



Poll

Do you think advisers will benefit from Chancellor George Osborne's guidance guarantee?

Job of the week

Latest jobs

View all jobs

Most recent comments

View more comments