I refer the speech by Dr Thomas Huertas, director wholesale firms division, at the Institute of Economic Affairs’ 10th anniversary conference recently.
In this speech, Huertas invites banks to come forward with a fee-based advice solution for the masses. He says: “We are genuinely interested in working with banks to find a way to do so.”
He also covers price capping but what IFAs would be interested in are his comments about retrospection.
He said: “Such a solution would have to provide financial institutions who implemented the solution with some comfort that they would not be the victim of retrospection or second-guessed by a future regulatory regime, that is, the possibility of someone in the future concluding that a product that lost money must have been missold in the first place.”
When is the FSA going to talk to IFAs about such a proposition? Or is it a foregone conclusion that IFAs are destined for the scrapheap? Wasn’t it John Tiner who said that “retrospection is out of the question”? Do the comments made by Huertas indicate that the FSA has finally realised that we have have experienced exactly that and are still in the grip of retrospection by the back door via the FOS?
Although it may be possible to provide lowcost generic advice, I cannot for the life of me see how a bank can charge a fee for selling its own dismal range of products. Can you? Are we in the UK going to end up like Germany, with four or five providers selling their own shade of grey? Is that anti-competitive?
So many questions and yet no answers are forthcoming from the regulators. The banks rule OK.