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.”
Never mind BBC salaries, it’s FCA invoice day. I actually think I get good value for the £2,700 to the FCA. The £13,200 to the FSCS less so
— Chris Budd (@ovationchris) July 19, 2017
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.”
“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. “