Banks and building societies’ direct sales forces will be hardest hit by misselling of with-profits bonds says Syndaxi Financial Planning director Robert Reid.
Responding to the 650,000 fine given to Bradford & Bingley by the FSA for misselling of with-profits bonds and precipice bonds, Reid said IFAs were less likely to be affected if they had recommended the with-profits product as part of an overall portfolio. B&B is being ordered to pay 6m compensation to 6,800 customers.
He says: “The direct sales forces are more likely to be hit by the regulator for mass selling of with-profits bonds. This could be the thin end of the wedge. But the FSA has given the sector a massive Christmas present by announcing this at a time when nobody will be reading the personal finance pages of the nationals.”