Aifa is concerned about some of the assumptions made by the FSA in its guidance on the structured product market following its review of Lehman-backed plans.
It is forming a working party to address issues facing firms following the guidance which was issued on October 27 and has called for members to provide evidence on the impact of the guidance.
The first meeting will take place on December 4 and will focus on the direct impact of the guidance, particularly around concentration of assets and contagion risk and the assessment that structured products are not suitable for risk-averse customers.
Director Robert Sinclair says: “Some errors were made in the advice process that we must learn from. However, we have real concerns with some of the assumptions made in the recent guidance published by the regulator.”
John Joseph Financial Services principal John Joseph says: “I am all for the working party. It is no surprise that the FSA can be accused of making mistakes, after all, they are only human, like IFAs. The question is whether they will admit it.”