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Apcims blasts ‘messy’ RDR for lack of grandfathering

FSA Letters 480

The Association of Private Client Investment Managers and Stockbrokers has blasted the “messy” RDR for not including grandfathering measures for advisers.

Speaking to Prospect and the London Stock Exchange today, Apcims chief executive Tim May said he supports the RDR overall but has reservations in certain areas.

He believes the lack of grandfathering is a “great shame”, Mifid II remains the “elephant in the room” and he is concerned about lack of advice for the mass market.

May says that while the RDR is important for Apcims members it will not have the same impact as for the IFA community. He welcomed the new qualification requirements but said the FSA should introduce some form of grandfathering.

He said: “Due to lack of grandfathering, many clients will lose trusted, experienced advisers, who will come out of the market – we have systems in place to aid sourcing of appropriate firms, but this is still challenging for many clients.”

He believes some of the positive message will be “confused” with uncertainty around the independent label.

May said: “There will be some confusion and noise in and around the positive messages. For the Apcims community specifically, clients trying to understand the new definition of the word “independent” will be confused. Fortunately the current clients of our firms have strong relationships but for new clients the definition will appear nonsensical.”

May argued there is still huge uncertainty around the effect of Mifid II on UK financial services and firms could end up bearing more costs.

He says: “Amendments have been submitted to protect RDR and the latest Council text bans all trail, but no-one knows where this will end up and who has the “right” answer. Only time will tell. If more change does happen, the costs to firms will be high and inevitably passed on to the client. Apcims would regard such a situation as more than messy – bordering on wholly unsatisfactory.”

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. RegulatorSaurusRex 23rd November 2012 at 5:54 pm

    It will all come out in the wash.

  2. Personally, I find studying text books irksome in the extreme and, having not sat a formal written examination since my French A Level re-sit in 1976, I don’t find exams much more palatable.

    But, for all that, I managed (just) to pass the single AIFA/Chartered Banker exam and, believe you me, if I can do it then anyone reasonably competent ought to be able to.

    Though having been forced to attain a higher qualification than FPC 1, 2 & 3 has been an unwelcome imposition, current indications appear to be that at least 90% of those giving it their best shot will make the grade, if not this side of Christmas then hopefully early in the New Year and the FSA appears to have been as accommodating as it reasonably can. For those who really do suffer from examophobia, it’s not even mandatory to go through the rigours of a formal written exam.

    So, whilst I’m not exactly the greatest fan of the FSA and I certainly haven’t become a convert to studying for and sitting exams (except for those who want to do them), given the responsibilities involved in true financial planning (as opposed merely to flogging products) I find it difficult to argue against the requirement of a higher minimum qualifications threshold than just the FPC. And I have little sympathy for those who intend to bomb out at the end of this year without even having tried to clear the Level 4 hurdle.

  3. Once again we see a professional body critising the RDR re grandfathering and the lack of advice for the mass market and of course the FSA take no notice. We no longer live in a democracy when unelected non representative bodies can do what they like.

  4. Exams are pointless. Been qualified for 14 months now and not once has any of the crap that was in any of the exams been of any use.I mean systemic risk of providers’ processes, the principles of money? How does that help improve sales of products? Yes sales!!!!!! You RDR supporters, (and that means both of you), will still have to sell products after the new year. If you think the vast bulk of your clients are going to pay fees for advice that doesnt lead to an end product are mentally unstable and totally insane. Advice is the process that leads to the end product and when a signature goes on the form to confirm the client wants the product, a purchase has been made. That is only half the story. The other half is that for a purchase to have taken place, guess what??? A sale has been made. So please lets not try to delude ourselves about advice will take the place of the product sale – it wont. Live with it and deal with it.

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