The FCA should take greater responsibility for regulated firms which fail, says Apfa chairman John Gummer.
Speaking at the Apfa annual dinner in London last week, Gummer said the FCA should “recognise its own responsibilities” in approving firms, and should bear the cost when things go wrong.
He said: “A regulator has a real responsibility for having said a company is accredited.
“One of the problems in the past has been that accredited firms – sometimes accredited against all the advice of the industry – collapse, and the industry has to pay the cost.
“That is the unfairness which most affects our members.”
Gummer also said the FCA and professional bodies need to focus more on “gatekeeping” and approving only the right people.
He said: “Apfa is keen to work with the FCA to share information to ensure that bad advisers do not pop up again elsewhere.
“We have to make sure that a professional body insists on those professional standards being upheld and make sure the system does not allow individuals to make a monkey of it.”
Gummer added the advice sector needs to “rapidly solve” internal arguments over definitions, such as the meaning of the advice label independent.
Aurora Financial Planning chartered financial planner Aj Somal says the FCA should take a share of responsibility for firms which fail.
He says: “The regulator should hold its hands up when things go wrong and take steps to ensure the situation does not happen again.
“There should also be more stringent controls to make sure advisers cannot dump their liabilities and move from firm to firm.”