FSA admits lack of clarity over SPS withdrawal
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The FSA has admitted it is not yet clear what will happen in cases where accredited bodies withdraw statements of professional standing from rogue advisers.
Advisers will have to hold an SPS under the RDR to certify they have reached minimum qualification standards. SPSs will be issued by accredited bodies.
The Chartered Insurance Institute, of which the Personal Finance Society is part, was one of the first six organisations to be awarded accredited body status in September.
At the PFS annual conference in Birmingham last night, PFS chief executive Fay Goddard questioned the FSA on whether advisers will be able to receive an SPS from another accredited body even after their original accredited body withdraws the SPS over rule breaches.
Goddard said: “What will happen if the CII withdraws an SPS from a member who commits a serious breach of our code of ethics or serious disciplinary offence? We cannot stop people trading, it is only the FSA that has the right to deauthorise. But if we withdraw an SPS what happens? Do they just go off to another accredited body?”
FSA conduct policy division head of department Nadege Genetay:“You are right in that it is for the FSA to decide to withdraw an individual’s approval. We expect accredited bodies to notify us and the firm if they are seeing any breaches and we encourage accredited bodies to share the information between them to the extent they can.
“It is hard to know what is going to happen to the advisers without knowing the circumstances of individual cases. It will depend on what the accredited bodies decide, what conditions they want to apply, and the serious of the breaches themselves. It is hard to give a black and white answer I am afraid.”
Goddard added it was “inevitable” this would be an issue, particularly given the size of the CII’s membership.
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