Speaking at an all-party parliamentary group on insurance and financial services meeting at the House of Commons yesterday, Sinclair said while Aifa shares concerns around commission, FSA proposals for adviser charging could leave Britain standing alone in this area because some EU partners take commission for investment business.
He said: “We share concerns around commission. But our major concern is that the EU is about to commence a major piece of work on packaged retail investment products which will cut across Mifid and Insurance Mediation Directive. We expect that to have a fundamental change because most of our European partners want to maintain commission in the investment environment.
“We are concerned that it will leave Britain standing alone in this area and we do not want to go through a process that leaves us isolated and for our providers who may decide that they do not want to play.”
Sinclair also aired concerns over the FSA’s emphasis on exams. He said: “The FSA is absolutely right in saying that an increase in professionalism is required.”
But he added: “I think one of the key challenges for us is to find our way through this mess of examinations to actual work based assessments.”
Sinclair also described the looming 2012 deadline as a cliff edge for the adviser community. He said: “We are becoming concerned with the date of 2012 for a number of reasons. It is a cliff edge set of dates now in terms of qualifications, changing systems and the capital requirements for firms.
“Another thing is how do we get consumers to the point where they value advice. Our concern is that, by having a cliff edge date for this, we are going to end up with people not taking advice because the feel they do not want to pay. There will be a load of people who end up surfing the internet and fall prey to those who not regulated and controlled in the same way.”