View more on these topics

Aifa warns that FSA must not use trade bodies to plug Newcob gaps

Aifa has warned that potential new FSA rules on industry guidance on the back of the regulator’s Newcob consultation must not push unwelcome additional responsibilities on to trade bodies.

The FSA will issue a discussion paper this week on the role of industry guidance in a Newcob world which will look at what trade bodies can additionally offer in the move to principle-based regulation.

Aifa director of public affairs Tracey Mullins says: “The regulator must not think it can use trade bodies to plug potential gaps by moving regulatory responsibility onto them.”

FSA director (retail policy and asset management sector) Dan Waters says the regulator will not require trade bodies to do anything against their will but such organisations should question their role after Newcob to look at areas where they may be best placed to offer guidance.

Waters says additional trade body work could take the form of case studies or Dear CEO letters on specific areas but there will be a full debate.

The Newcob consultation paper confirms that the menu and IDD will be kept but a postimplementation review – due to become effective in April 2008 – will look at a radical menu simplification, with Waters admitting its success is still to be proved.

The Newcob consultation paper radically cuts prescriptive rules across the board such as for suitability letters and financial promotions, replacing them with highlevel principles.

Waters says: “With a substantial simplification of the rulebook, we are looking at the role of industry guidance but we will not require trade bodies to do anything that they are unhappy with. The question is, do they think there is a role for them here?”

Recommended

This week in Politics

The Tory’s independent tax commission published its well leaked proposals to reform the tax system and slash the overall burden of taxes by 21bn.

FSA action against mortgage broker

The FSA has ordered a mortgage adviser to stop carrying out regulated activities for failing to organise and control his business responsibly and effectively.The regulator says it took action after receiving information from a lender that it had removed the adviser, Paramjit Singh Bali, from its panel due to concerns about mortgage applications submitted to […]

The Way to IHT planning

The Way Group has designed an inheritance tax planning product aimed at people who have a high net income.

Charcol wants to team up with football clubs

John Charcol is looking at offering mortgages via affinity partnerships with football clubs. The broker believes that many football supporters are getting a poor deal with poor affinity deals on other financial services products such as credit cards and general insurance when products are sold direct and it believes that a broking service would offer […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment