View more on these topics

FCA warned on ‘ambitious’ advice review timetable

Clock money 620 x 430

The FCA’s practitioner panel has warned the regulator not to rush implementation of reforms following the conclusion of the Financial Advice Market Review.

The review, which was unveiled in August and is being carried out in conjunction with the Treasury, will examine how advice could work better for consumers.

In particular it will focus on issues including the advice gap, regulatory barriers facing advice firms, and how technology can be used to provide “cost-effective” advice.

The findings of the review will be published ahead of the March Budget.

However, speaking to Parliament’s Treasury committee today, practitioner panel chairman and HSBC UK and Europe chief executive Antonio Simoes said the panel had warned FCA acting chief executive Tracey McDermott on the timescale of the review.

He said: “We were very supportive of the terms of reference, but we had a word of warning in terms of the timescales.

“It’s very ambitious. This is an issue that’s been around for a long time, so it’s important that we get to the right solution, rather than just getting one quickly.”

Simoes added that he hopes the FAMR will provide more certainty to advisers on liabilities.

He said: “You should have more certainty in the regulatory regime so that firms are confident that they can offer advice to someone with £40,000, and that advice is going to be simple and straightforward and the cost of that will be commensurate.”

Recommended

2

MPs to probe ‘moving goalposts’ of state pension reform

The Work and Pensions committee is to follow its investigation of the retirement freedoms with a new inquiry into the state pension reforms. The committee says it is worried those close to retirement in particular may not understand the new system, having done most of their planning under the previous rules. It also raises concerns […]

11

MPs push for two-year FCA fee freeze

Three MPs have launched a motion in Parliament to call for a two-year freeze on FCA fee increases in a bid to improve access to advice. In an early day motion filed this morning, Labour MP Alan Meale, Conservative MP Peter Bottomley and Northern Ireland’s SDLP MP Mark Durkan argue any further increases in regulatory […]

Life cover for life

When someone mentions whole of life plans, most people will think of a niche product that serves as an inheritance tax planning tool for high-net-worth clients. And it’s really not surprising they’ve been pigeonholed in that waybecause before the arrival of RDR in 2013, that’s more or less exactly what they were. For advisers thinking […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

There are 5 comments at the moment, we would love to hear your opinion too.

  1. Agreed, it is important to get it right as apposed to getting out on time. However I for one will be hugely shocked if the FCA actually do something to remove some of the ludicrous barriers which currently make regulated advice so expensive for what should be a very simple process. The reason being that to reduce the barriers means reducing a large number of regulations around the advice process. Unless they are forced to do so, they will not do it. As they are supposed to be independent of government (and therefore the treasury) they can easily say “We have listened and looked at how to do this. We know it is not a perfect system however, in the round, it is working as well as it possibly can, sorry chaps, no can do” and the treasury can do sweet FA about it. thats the theory anyway. Maybe in practice it will be different but regardless I would not hold my breath for a pile of sensible outcomes or improvements from FAMR. I do hope I am proved totally and completely wrong in fact I would love to be.

  2. The FAMR timetable is too ambitious if the job is to be done properly.

  3. The outcome is predictable, everyone except the FCA will have to change their ways to make it work. When you have no concept of financial responsibility or commercial awareness, it is easy to tell others what to do and where they should spend their money.

  4. Marty Y ~ agree with the gist of your comments, though the FCA’s entirely predictable attempt to brush off the Treasury’s intervention has already been overruled in no uncertain terms. This review may actually result in some fundamental and positive changes, whether the FCA wants them or not. After all, it’s Osborne who decided that Martin Wheatley’s contract would not be renewed, Osborne who ordered this review and Tracey McDermott is on record as having admitted that the FCA’s maniacal programme of endless change and embellishment to its rules and regulations are unsustainable. The days of the FCA being able to set and pursue its own agenda whilst paying no more than token heed to what anyone else may think or say may finally be coming to an end.

    My earnest wish is that this time and from now on it will be forced to publish for all to see and to debate in open forum all responses to its consultations which, to date, have been nothing more than hollow, token shams of engagement with the industry it purports to regulate, instead of claiming merely to “have taken those responses on board” and steaming ahead regardless.

  5. I look at what I have to do in my job and pretty much half of it relates not to what I do but to justifying what I do. So from that simple perspective the cost of providing advice is therefore at least twice as much as it ought to be. I find it demoralising that clients do not have to take more responsibility for their buying decisions. If I buy anything I regard myself as being the person responsible for my own decisions, and as long as I have not been lied to or misled then I do not understand why I would have the right to complain or get compensation for an inappropriate purchase. I think there is too much protection for clients and too much compensation paid to people who have simply failed to carry out due diligence on their purchase. Financial services regulation is far too interfering and has far too many rules and regulations. The costs of paying for the protection provided by the FCA are truly massive in relation to the amount of protection afforded by their existence. What a shame that this overzealous approach has led to the removal of advice from the general public, and that advice is now only value for money for those who already have plenty of money in the first place. FCA – stop basing your rules and regulations on the twin premises that people who buy financial advice are stupid and that advisers are exploiters of ignorance.

Leave a comment