View more on these topics

Advisers will retain independent label if remuneration is clearly disclosed

Advisers will be able to retain their independent label as long as they agree remuneration methods upfront with a customer, according to sources close to the FSA’s Retail Distribution Review.

Reports that advisers would only be able to call themselves independent if they were fee-based are said to be unfounded.

Sources say that as long as advisers operate on a transparent remuneration structure and agree how much the customer is going to pay for their services upfront, they will be able to keep the independent label.

This can be done through factory-gate pricing, fee-based advice or offsetting commission as long as it is disclosed to the customer.

Another source says that the paper proposes that if advisers take certain qualifications to increase their “professionalism” and operate a transparent charging structure which avoids consumer detriment then they could get a reduction in their capital adequacy requirements as an incentive.

It is thought that adviser firms that do not achieve a certain level of professionalism and who present bigger compliance risks will be hit hard by having to hold higher levels of capital adequacy.

A source says the FSA is trying to redefine the term fee-based remuneration to mean any payment which has been agreed with the customer. The use of the label independent looks to be conditional on having agreed the level of remuneration upfront with the customer.

The four headings under which the market is likely to be segmented are professional financial planning, broad financial advice, no advice and general advice.

It is thought that smaller IFA firms in particular will be the focus of much of the RDR and that advisers will be given a timeframe within which to move to one of the four models if they are not already.

Click here to read all RDR stories

Click here for the straw poll


A Shaw thing

Sam Shaw is a reporter on Money MarketingThis week certainly presented some highlights in terms of my journalistic career to date. Tuesday was the ever-pleasant AIC party on the roof terrace of the City’s Coq d’Argent. Shame the weather did not hold out as the view from 1 Poultry is pretty spectacular.I made do with […]


ECJ backs AIC calls for Vat-free investment trusts

The European Court of Justice backs the Association of Investment Companies and JP Morgan Claverhouse’s that investment trusts should be exempt from Vat on management expenses. The AIC says the industry is now due to be repaid up to £300m and save £40m a year in Vat, now that investment trusts can be exempt, as […]

Focus Solutions breaks £1m profit

Focus Solutions Group has announced a pre-tax profit of £1.04m for the year ended March 31, 2007, up from £0.11m at the same time in 2006.Sales revenue reached £7.91m, up 20 per cent from £6.58m and operating profit before exceptional costs reached £1.20m, an increase of £0.83m.Focus attributes its success to significant new contract wins […]

Crashing back down to reality

After spending an enjoyable two weeks off on holiday in Japan, I was thrown into the deep end with the publication of the FSA’s Retail Distribution Review discussion paper this Wednesday.

How to balance bottom-up with top-down research in constructing multi-asset credit portfolios

In this short video, Azhar Hussain, head of global high yield at Royal London Asset Management, explains how his team balance bottom-up with top-down research in constructing multi-asset credit portfolios. Watch the video in full The value of investments and the income from them is not guaranteed and may go down as well as up […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers. Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and thought leadership.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm