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Comment of the week: FCA must clarify advice/guidance boundaries

If the FCA and potentially the Financial Ombudsman Service are going to hold me to the regulator’s definition of what constitutes ‘advice’ or ‘guidance’, then I think I am well within my rights to require George Osborne and the powers that be stick with that very same definition.

One point that everyone, including PFS chief executive Keith Richards, seems to be agreed on is that people need to be educated about what exactly constitutes advice or guidance and what protection, etc, comes with each. The Government, the Money Advice Service and now industry spokesmen happily interchanging the two terms does nothing at all to educate the public. In fact, it does the complete opposite and further muddies the water.

The FCA must make clarification of the advice or guidance argument a priority before April 2015 or there will be a lot of people finding out at retirement that the Chancellor’s word is no good. Although, some may already suspect that.

Nick Wardle 

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  1. Julian Stevens 2nd June 2014 at 10:24 am

    The very fact that the MAS regularly tries to assure the world at large that it offers only guidance and not advice, what hope can there be for intermediaries who are naturally concerned about the risk that their provision of the former may well be construed as having been the latter? So far, there seems to have been a notable reluctance on the part of the MAS to “guide” people towards qualified and regulated advisers, whose services will have to be paid for, one way or another. Quite probably, not least in view of its misnomer, a lot of people regard the MAS as a channel from which they can obtain advice without having to pay for it. Isn’t calling the MAS something that it isn’t a fundamental breach of the FCA’s requirements that all and any promotions must be clear, fair and not misleading?

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