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Advisers will be probed on rebated commission

IFAs will be questioned over the amount of commission they rebate back to clients as part of the FSA&#39s bid to calculate the market average commission under its menu proposals.

The FSA is proposing to carry out regular surveys of advisers to derive the effect of direct rebating on the commission figures so it can more accurately calculate what the market average should be.

This information will be collated with data from product providers on how much commission they pay in different product areas.

The FSA says providers may not necessarily know if advisers are rebating commission directly to customers but says it is not that important for the market average commission to be completely accurate as its own research suggests that consumers do not expect it to offer anything more than an indication of what the true average will be.

IFA network Alpha to Omega chief executive Stewart Wooles says it will be hard to come up with an IFA sample that will not be statistically skewed.

He says: “These samples tend to run with volume, not value, meaning those with significantly better rates will be under-represented.”

LIA head of public affairs John Ellis says: “Because the market average will need to be changed all the time, I can see a lot of old copies of the menu floating around. It will be out of date before it hits the streets.”


Critical slump at ScotEq

Scottish Equitable Protect&#39s sales of critical-illness policies have dropped significantly since it withdrew from the guaranteed rate market. In 2002, critical cover accounted for around 50 per cent of the total protection book and in 2003 this dropped to around 30 per cent. The company says this reflects a variety of factors. It says some […]

Teather & Greenwood – Childcare Corporation 7

Type: Enterprise investment scheme Aim: Growth by investing in children&#39s day nurseries across the UK Minimum investment: Lump sum £5,000 Closing date: April 5, 2004 for 2003/2004 tax year, May 28, 2004 for 2003/2004 tax year Charges: Initial 6.5%, Commission: Initial 2.5% Tel: 020 7426 3204

Liverpool Vic says realistic regime will not hit capital

Liverpool Victoria has trimmed with-profits policy bonus rates but claims its financial strength holds strong, with the FSA&#39s realistic reporting regime not expected to have any negative effects on its capital position. Cuts to annual bonus rates range from 0.2 per cent to 0.35 per cent, with final bonuses dropping by between 5.1 per cent […]

One, two, three O&#39Learys

Staff at tech outsourcing operation Marlborough Stirling were expecting a tall Irishman when they heard that a West Midlands football manager called O&#39Leary was taking over as chief executive. Staff were bracing themselves for a tell-all autobiography and wise words on playing 4-4-2 until it was revealed that his first name was Michael and not […]

Spring has sprung

Well, it’s been lovely to see a little bit of sunshine, even if it was only a brief appearance. I live in Scotland so, believe me, it was very brief.  Of course, with even the tiniest hint of spring, thoughts turn to the inevitable clearout that must take place.  And that got me to thinking […]


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