FSA to probe sole adviser sales data
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The FSA is proposing to ramp up its scrutiny of individual advisers by capturing information about their transactional activity.
According to the regulator’s RDR consultation paper on professionalism, published this week, the regulator is undecided on whether to get this information from product sales data returns submitted by provider firms or from adviser firms directly.
The FSA states: “The PSD record already requires information to be reported at an individual transaction level alth-ough providers may not hold data on the individual adviser involved in the transaction.
“We expect that advisory firms would collect information on the sales made by their advisers at an individual adviser level. It may be necessary for us to require advisers to supply prov-iders with the adviser’s individual reference number.
“Alternatively, sourcing data from adviser firms may be a more effective approach as we could then see across the range of transactions recommended for an individual customer.”
The FSA says this would allow it to improve its understanding of risks that might arise at an individual level and better protect consumers.
The FSA says it will consult further on these requirements later in the year.
Institute of Financial Planning chief executive Nick Cann says: “The FSA also wants accredited bodies to supply it with more information about their members. The issue is what the regulator is planning to do with that information and whether it understands it fully.
“In principle, I am all for greater transparency but I am slightly nervous that people do not necessarily understand the information they are given or the way that advisers work and may misinterpret it.”
The FSA has yet to provide estimates of the cost to the industry of collecting this transactional data as it says this will depend on whether it decides to get this information from advisers or providers.
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