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Clarke attacks ‘staggeringly expensive’ FSA

Tory leadership candidate Ken Clarke has attacked the FSA, questioning whether the regulator has its costs under control.

In a speech to Cass Business School in London, former Chancellor Clarke said there was increasing hostility in the City to the “staggeringly expensive” costs that the FSA creates for the industry.

He said this mood has deepened over the last couple of years as the costs and implications of regulation have become more apparent.

Clarke also raised concerns that the regulator’s agenda is being driven by lobbying rather than serving consumer interests.

In a speech attacking Chancellor Gordon Brown’s management of the economy, Clarke spoke of tackling an over-regulated society with regulators needing to work with business, not seeing the people they inspect as the enemy.

He said it was hard for pol- iticians to make such statements as the public and powerful single issue lobbies are demanding more regulation but an attempt must be made to curb this culture.

Clarke also stepped into the pension debate, calling Government policies “irr-esponsible and short-sighted”. He said the first area he would look at for tax relief would be pensions and savings rather than cuts in direct personal taxation, striving to reverse Brown’s “5bn a year raid on pensions”.

Clarke said: “The FSA should ask itself whether they have the complexities and costs of regulation under control.”

Ascentric, the wrap provider backed by a consortium of IFAs, says it now has full funding for its wrap which will launch at the end of this year.

The first phase of the launch will be for IFA partner firms and the service will be extended to other advisers two months later.

Managing director Hugo Thorman, who was involved in Abbey’s wrap project, says the funding is in place from pri-vate investors and anticipates a launch date of late December for the wrap to become operational for its eight founding IFA firms. A total of around 5m has been invested in the project.

The founding partner IFA firms are: Moneywise IFAs, Kings Court Financial Planning, Grosvenor Consultancy, Avidus Wealth Management and Vintage Financial. Two more firms are in the process of agreeing terms.

Thorman says the company is going through FSA change of control regulations and he is hoping for approval to be granted in early October.

The Ascentric wrap will offer advisers access to all funds and product wrappers.

Thorman aims to market the proposition as a white-labelled product, which IFA firms can personalise and he is targeting firms with fewer than 15 registered individuals.

He says: “We are delighted that our private fund-raising has been so successful. We are submitting to the FSA and will be in business with a full wrap by the end of the year. There has been a huge amount of interest from advisers.

“It is the only independent IFA-owned platform on the market. IFAs are very concerned by the increasing involvement of product providers in wrap and fund supermarket platforms. We appear to be the only independent fund supermarket available.”

The service will offer a range of commission opt- ions, model portfolio capa- bility and an integrated calculator to assess fund performance and asset allocation.


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