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Aifa warns of cost of overhauling regulator

The Association of Independent Financial Advisers has welcomed Sir James Sassoon’s review of the tripartite system, commissioned by the Conservative party, but warned of the cost involved with overhauling regulatory structures.

Director general Chris Cummings says it is clear there needs to be an overhaul of financial regulation both at national and at European level.

He says: “We need a system which has increased accountability, more transparency, delivers in a cost-effective way and works better for firms and the clients they serve.

“However, it should always be remembered that changing structures costs money and doesn’t necessarily lead to better outcomes. We will be investigating the implications of these proposals in much closer detail before advising members.”

Cummings says Aifa is keen to further investigate the implications for members of a “twin peaks” approach to regulation.

He says: “In addition, talk of separating the regulation of firms from consumer protection is an interesting notion which merits further review. One thing is certain; the current regulatory structures should not be taken for granted.

“AIFA will shortly be publishing a position paper which will set out in further detail our stance on the recent proposals put forward, as well as setting out our own ideas on how to best reform the regulatory system.”

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