Royal London says advisers are safe to adopt one platform
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Royal London says advisers can adopt one platform if they have access to a full range of wrappers and funds.
In its response to the FSA’s RDR consultation paper, the Royal London Group, parent company of the Ascentric wrap, says any rules or guidance issued by the regulator should make it clear that it is appropriate for an adviser to use a single platform as long as the platform has access to a full range of wrappers and funds.
The response says: “Providing an adviser is satisfied that a particular wrap platform meets the needs of their client-base and the requirements of the independent definition the adviser should be able to utilise a single wrap platform.
“Indeed this may bring some important benefits in the administration of an adviser’s client relationships.”
The group, which includes Scottish Life, Bright Grey, Scottish Provident and Royal London 360, also believes that the FSA should monitor the level of adviser charges set by firms.
The response says: “Each provider firm has only a partial picture of the total transaction and cannot discern the level of adviser charges that are being deducted from each of the recommended investments. Only the regulator can be in full possession of the entire picture of a consumer’s relationship with the adviser. For this reason we firmly believe that it is for the regulator, with the full co-operation of provider firms, to monitor the level of adviser charges.”
Royal London also believes that factoring should be retained for all regular premium investment business whether written on an individual or grouped basis.
The response says: “We favour a standard discount rate and standard period, three to five years, over which the factored adviser charge can be recouped.”
The group also says restricted advice firms should not be allowed to give consumers the impression that their service is in some way independent advice in its name or promotional material.
The response says: “It is essential that consumers understand the nature of the service they are receiving – and paying for. Firms should be required to make written and verbal disclosure of the nature of their service when it is being delivered face-to-face.”
Under the proposed Code of Ethics, Royal London says the requirement for advisers operating simplified advice processes to reach QCA level 4 should be removed. Royal London says in order to give market participants the impetus it needs to make the investment in the development of simplified advice, the regulator will need to provide some high level principals on the essential features of a robust and compliant simplified advice process.
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