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&#39Tied must reveal costs&#39

The FSA must force tied and multi-tied agents to disclose distribution costs to prevent them claiming they give free advice, says Clerical Medical.

Pensions strategy manager Nigel Stammers says failure to disclose distribution costs in the tied sectors would go against CP121&#39s basic principle of transparency.

He says the FSA will have to work out a clear definition of what counts as a cost of distribution including indirect benefits such as IT systems support, marketing support and cash injections for multi-tie firms. Direct salesforces should also be forced to disclose costs of advice, he says.

Stammers says: “For the same reason that Sandler wants IFAs to have a conversation with the consumer over his cost of distribution, a similar conversation should happen about the provider&#39s cost of advice or the multi-tie&#39s cost of advice. If a multi-tie or single-tied adviser is able to say he gives his advice for free then IFAs&#39 services will look more expensive.”


The flexible future

With flexible mortgages becoming an ever more popular choice, it seems hardly surprising that most lenders offer a variation of one sort or the other for almost every kind of borrower.However, opinion in the market remains split. Some strongly advocate flexible mortgages while others believe that flexibility is a mere marketing gimmick and that actual […]


Watchdog warning on endowment calculations

The Financial Ombudsman is warning that some firms are taking the wrong approach to calculating compensation on top-up mortgage endowments by offsetting “gains” in one policy against “losses” in another.In this month’ Ombudsman News, it says, in line with FSA guidance, firms must carry out an additional redress calculation for any top-up policies as they […]

CA calls for non-political body to set pension policies

The Consumers&#39 Association is calling for a non-political body to be set up, responsible for pension policy in the UK, citing failure by the Government to address the growing pension crisis.CA senior policy adviser Mick McAteer issued the call for a new body which would depoliticise pensions at the Liberal Democrat Conference in Brigh- ton […]

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