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&#39Code of conduct is needed to combat misselling&#39

Money Marketing&#39s misselling campaign has split advisers over the need for a clear definition of misselling.

Many believe a definition is a necessity for financial services to be secure in the future but some IFAs believe the answer could lie more in business practices and codes of conduct.

IFA R-M Associates director Alistair MacDougall says when dealing with client complaints, missell-ing is easy to identify when you see it.

He considers that most misselling cases either involve advisers who are not able to demonstrate that they have properly identified and/or understood all the relevant factors relating to client situation and needs or not being able to demonstrate that the client was informed of all the relevant factors necessary to make an informed decision.

LIA head of public affairs John Ellis believes that trying to define misselling is a sterile activity and it would be better to promulgate professional standards.

But Syndaxi Financial Planning principal Robert Reid says a definition of misselling is vital for the industry although he also believes the industry needs higher standards of best practice or a code of conduct.

He says: “These steps should have been taken a long time ago. We need best practice and it needs to be promoted to the public.”

Ellis says: “Professional standards would ensure that the financial advice profession is doing good quality business, treating customers fairly and keeping appropriate records for future eventualities such as an ombudsman case.”

MacDougall says: “It is clearly impossible to define misselling in the definitive and all encompassing way being sought because of the endless possibilities there are for subtly different scenarios with different clients.”

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