View more on these topics

Examples show ways of meeting definition

The FSA has set out examples of where advisers would and would not meet the definition of independence when using platforms.

It says it can be harder to meet independence rules when using platforms as the product range of investment bonds, personal pensions and Sipps can be more limited.

The regulator says a firm that segments clients to provide a premier service to wealthier clients and which carries out due diligence on its chosen platform would still be independent where the platform has proved to be suitable for most clients, and where the firm recommended products off-platform where suitable.

A firm can use one platform for the majority of cli-ents, provided it is aware of other products across the market. If a firm uses a single platform routinely for all clients, the FSA says this risks unsuitable advice.

Firms can use multiple platforms for client segments with different needs, as long as there is a process in place to ensure each client is considered individually.

Where a firm has individual advisers using different platforms, with a lack of consistency in approach, the FSA deems this to be bad practice.
The FSA says: “The outcome we are seeking is not about ensuring an artificial spread of investments to meet the independence rule, it is about being mindful of the range of product and investment options across the whole market in order that firms can provide suitable advice to their clients.”

Recommended

Taxonomy of tax

Only once the concept of intermediation has been properly defined can we start to understand what is VAT-able

Nationwide reduces five-year fixes and two-year trackers

Nationwide is to reduce all of its five-year fixed mortgage rates by 0.10 per cent and all of its two-year trackers by 0.15 per cent for new customers. The reduction means the building society is offering a five-year fixed rate at 3.99 per cent, up to 70 per cent loan-to-value, with a £99 booking fee. […]

Lang and Pattisson: We have big ambitions for Ardevora

Ardevora’s Jeremy Lang and Bill Pattisson have set the new firm the steep target of running £10bn of assets within the next 10 to 15 years as they look to replicate their success at Liontrust. The pair set up Ardevora in January last year and recruited their former colleague Rob Page from Ignis in April […]

Axa platform sees AUM pass £2bn

Axa Wealth platform assets under management rose to £2.9bn in the first half of 2011, an increase of 107 per cent compared to the same period in 2010. The AUM figure includes £700m self-invested assets from The One from Winterthur. Platform business represents 40 per cent of all sales, rising from 21 per cent in […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment