Aifa director general Chris Cummings says providers checking the quality of advice could lead to confusion over responsibility for misselling.
He says it would also result in providers’ second-guessing IFA decisions and lead to problems with the Data Protection Act if providers want evidence to back advisers’ decisions.
Cummings says providers take greater responsibility for quality of products and communication to advisers but says the FSA’s suggestions could shift the balance too far.
He told the conference he would be “massively uncomfortable” if there were any suggestions that manufacturers should police distributors.
Cummings says: “We cannot get to a stage when providers have to assess the quality of each piece of advice when they have no access to the clients or the fact-find. Manufacturers will end up second-guessing advice given by IFAs. I do not think providers have the skills, experience or appetite to do this. If a provider sanctions the advice given, then who does the client complain about if that advice proves to be wrong?”
IFA Defence Union chief Evan Owen says: “I have no faith in providers knowing what constitutes good or bad advice. It is even more difficult for the FSA to justify why it is paid so much when it is devolving so much responsibility to the industry.”