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10% of IFA firms may have to change name

One in 10 IFA firms face having to change their name if they want to continue to be paid by commission under the FSA&#39s depolarisation proposals.

Research from IFA Promotion shows that 1,080 of its 10,061 registered firms have “independent” in their name, and many other names include words that suggest independence, which could fall foul of CP121 if they fail to adopt defined-payment agreements.

Many IFAs are concerned they will lose goodwill earned from years of investing in their brand. They say changing their name will lead to admin and marketing expense and could lose them clients.

IFAs are also calling for the FSA to sanction the use of the regulator&#39s logo on IFA stationery. Firms were previously allowed to use the PIA logo but this must be removed from all documents by June.

The FSA says it will consult over the summer on whether IFAs can use its logo, saying the issue of status disclosure complicates the issue. IFAs argue that an FSA logo is easily understood by consumers and communicates the fact that IFAs are regulated.

Denyer Insurance Consult-ancy managing director Simon Hill says: “I pay a lot of money to be regulated and a logo conveys quickly to consumers that I am regulated.”

First Independent Direct director Ian Brewer says: “If we were made to change our name it would be disastrous. We have invested time and money in our brand. We would have to think up another name to communicate the same concept we already have.”

An FSA spokeswoman says: “This is a consultation process. We are looking at the effects that these regulations will have on the industry.”

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