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40% Of firms that left Sesame cite RDR as reason

Sesame Bankhall Group says 40 per cent of advice firms that left the network in 2010 did so as a direct result of the RDR.

The group’s submission to the Treasury select committee’s RDR consultation says: “While the overall number of adviser firms in Sesame’s network remained stable in 2010, taking into account joiners and leavers, it is noticeable that, of the firms that did leave, 40 per cent said it was a direct result of the RDR.”

Sesame Bankhall says this, along with the FSA’s own prediction that 25 per cent of advisers will leave the market after RDR, are evidence that at least one of the review’s original objectives will not be met.

It says: “Instead of the FSA delivering on its original objectives, including widening consumer access to fin- ancial advice, we have RDR proposals that will reduce access, reduce the number of advisers and cost the ind- ustry £1.7bn.”

Sesame says it supports the drive to higher professional standards and greater transparency but the net result of the RDR is likely to be detrimental to consumers.

It says: “Financial advice will become the preserve of the very wealthy. The mass market will find itself underserved or, even worse, not served at all.”

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Comments

There are 5 comments at the moment, we would love to hear your opinion too.

  1. I am sure they would all have cited: Business Monitoring Unit in India, Sesame charging, Sesame gold plating, encrypted e-mails that dont work, etc

  2. But at least the FSA will have acheived the real aim of the RDR – to get rid of IFAs no matter what.

  3. I left Sesame and the industry in 2006 and have never missed one single bit of either the industry or Sesame. It was however, the industry I grew to hate and not Sesame. I am still working full time in a different field and I am loving it.

    As they say on Dragon’s Den. I’m out!

  4. Now I know more people who have left than those who remain.

    Easy the way to regulate any potential problems out of an industry – no industry.

    Cant disagree that the outcome would work, 100% guaranteed success.

    The government could then start on some other industries next, whos next?

  5. Just how bad will the rate of industry casualties have to become before anyone at the FSA is prepared to admit that it has passed the point of acceptability? So far, the FSA has declared a figure of 20% to be acceptable (only to the FSA, mind, not to anyone else). A fifth of the adviser population having their livelihoods confiscated by the FSA for failing to conform to a new set of unilaterally imposed benchmarks. Not because the victims of this new broom are necessarily bad practitioners. Some of them may be, but many will not. What about the bad advisers who happen to be good at passing exams? There’s plenty of evidence that such people exist. Unless they happen to be targetted with an FSA arrow visit, they’ll be free to carry on much as before, whilst all the good guys who find exams very difficult will have been forced to abandon their clients and to scratch around for an alternative living at a very difficult time of life.

    What if the casualty rate reaches 25%? Or 30%? Will the FSA then finally concede that these exceed any reasonable threshold of acceptability and that the RDR has caused more harm than good? Or will ‘fear of losing face’ mean that the FSA/FCA merely remains silent and declines to offer comment?

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