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Aifa lobbies for limited advice with disclaimer

Aifa is to lobby for the introduction of limited advice, which would enable advisers to offer advice on specific product areas without the compliance risk of carrying out a full fact-find.

Under Aifa’s proposals, advisers’ clients would sign a disclaimer that would enable an adviser to, for example, advise a client purely on how best to invest a 60,000 inheritance without having to worry about asking about their pension or life cover needs.

Director general Chris Cummings says a suitable, plain English disclaimer would ensure that the client and adviser are clear at the time and in the future of what was and was not in scope with the advice.

The call comes in response to Conservative proposals to introduce a clear waiver for certain high-risk products that would exonerate adv- isers if the product failed to deliver. Cummings says, unlike Tory MP John Redwood’s proposals, the IFA would still be liable for the advice under Aifa’s plans.

He says the proposal would help consumers get tailored advice in a shorter timeframe, protect firms and cap Financial Ombudsman Service and FSA liabilities.

Cummings says he is deeply encouraged by Aifa discussions with the Conservatives and the party’s openness to consider changes that protect consumers but take account of the concept of caveat emptor. Syndaxi Financial Planning managing director Robert Reid says: “This is a good idea in theory although with the constant tweaking to Government policy it will be difficult to ensure advice can be compartmentalised in this way without affecting other areas of fin-ancial planning. Engaging in clear, defined briefs is a good way forward.”

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