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Advisers slam levy increases as FSCS bills hit desks

Advisers have hit out at increases in their FCA levies, particularly the portion that goes to fund the Financial Services Compensation Scheme, as regulatory bills for the year begin landing on desks.

Advisers have started to receive their invoices from the FCA this week, which also splits out how much they have to pay towards the FSCS, Money Advice Service and Financial Ombudsman Service.

Norwich based advisers Almary Green have been asked to pay a total of £96,783 in regulatory fees. The FSCS levy represents the overwhelming majority at £84,584.

The FCA’s bill accounts for £11,230, while the FOS’ levy came in at £465.

Almarry Green managing director Carl Lamb says: “The obvious question is for how much longer should firms like ourselves have to pay for poor practise elsewhere?

“We can’t be treated as a bottomless pit and don’t carry a magic money tree that is available at a drop of a hat.”

Alan Steel Asset Management chairman Alan Steel says his firm paid around £150,000 in total bills, with a similar amount on top for professional indemnity insurance “all because Governments and regulators screw it all up year after year.”

Scottsdale Moneywise financial consultant James Tarry also says his firm’s bills were also up around 10 per cent.

While the FSCS handed investment advisers a refund of £50m earlier this year, it also levied a £36m supplementary levy on life and pensions advisers due to ongoing high numbers of Sipp related claims.

Overall, financial services firms will pay £363m towards the FSCS in 2017/18, up from £337m the previous year.

Ovation director Chris Budd says his three-adviser firm paid £13,200 in FSCS levies and a further £2,700 in FCA bills.

While he says that the FCA portion represented value for money, the situation where low-risk firms contribute heavily to the FSCS for higher-risk firm failures needed to be addressed.

Budd says: “I’m not unhappy with what I paid the FCA; I actually think that’s quite good value for money considering what they do. But we could pay more to the FCA so they stop companies ripping people off.

“Why not increase their activity on firms that we all know are doing dubious things? Local guys, we all know the dubious people in our area, so we’ll have less fees in the long run and less consumers getting stitched up.”

‘A substantial step forward’: How FSCS bills could fall by over 60%

“I’m not knocking the FCA but it does seem to me that the good guys pay for the bad guys. It’s an absolutely bonkers model. “

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Comments

There are 8 comments at the moment, we would love to hear your opinion too.

  1. Julian Stevens 19th July 2017 at 1:05 pm

    How can the portion of our levies taken by the FCA represent good value when the reason our FSCS levies are forever increasing is a direct consequence of FAILURE on the part of the FCA to identify, home in on and take action against firms flogging toxic unregulated junk, almost always without relevant PII in place?

    And that’s without considering the FCA’s expenditure of £60,000 on a relatively trivial redesign of its logo, its planned expenditure of £60m to refurbish its new offices in Stratford (surely, for that kind of money, a brand new office complex could be built?) or the seemingly arbitrary yet not inconsiderable bonuses lavished on its directors? Plus, of course, its never-ending catalogue of reviews, consultations and studies etc. into things that many people consider to be of highly questionable relevance or importance.

  2. I’m not that bright, so as usual I may be talking a load of rubbish, but I just checked the FCA out on a limited companies data website.

    They have the same company year end as I do and whilst my company data is already published – and has been for weeks as it was needed for my Gabriel return, the data for them for the 2016/17 trading year is yet to be published! One rule for them and another for us it seems.

    Anyway, for the 2015/16 trading year, the FCA had a turnover of £580million and from that they made a pre tax profit of £27,800,000. The fact that they make a profit at all is a mystery to me. They are not a trading company.

    But on the day when there is a relative naming and shaming of BBC talent, I noticed that the total wages and salaries bill for the FCA last year was £330,700,000 and that they had 3,276 employees.

    This produces an average wage or salary bill of £100,946 per employee. This has to be one of the highest paid pseudo governmental departments. How on this planet can they justify these figures? Oh, of course, they don’t have to do they. Immune and unaccountable I think they say. And they have the audacity to want to investigate the value for money provided by advisers and platforms.

    Their actions speak so loud I can’t hear a word they say.

  3. Nicholas Pleasure 19th July 2017 at 4:10 pm

    The FCA is a gravy train for those that ride it. Unaccountable spending, unaccountable salaries and unaccountable ongoing failure. Julian Stevens and John Reilly; your comments are both spot on.

  4. Budd LAD KNOCK THE FCA INTO THE NEXT CENTURY the good guys pay for the bad guys. It’s an absolutely bonkers model. YOU SAID IT

  5. anyway wish i could pay it just in cash opps same name as the editor cant be his real name

  6. So if nearly all the losses are due to use of SIPPs to flog UCIS put a levy on SIPPs not UCiS. I only use SIPPs for clients who want to hold their commercial premises and even then, SSAS are often better. Then we would not need to pay these excessive FSCS fees as it would ALL be levied on the SIPPs or SSAs I.e users

  7. This is an abuse of power – pure and simple.

    Lets see if we can get national media as interested in this as BBC salaries. Both have the same root namely bodies running on a hypothocated tax

    • Libertatem should be campaigning for meaningful (as opposed to token) oversight on the part of the NAO of how the FCA spends our money. It should also be campaigning for the TSC to be granted the powers necessary to hold the FCA to account (of which it presently has none).

      Are these not on Libertatem’s agenda? And we’ve heard nothing about Howard Flight for quite some time. I thought he’s supposed to be your man in Parliament?

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