Platforms are potentially a good thing for financial planning businesses but there are some risks that need to be monitored, the FSA has told the IFP.
Spokesman for the retail policy division Rory Percival spoke at the IFP conference in Manchester last week and reassured advisers that the regulator understands the benefits of platforms and how they fit with proposals in the RDR.
He said: “Issues like professionalism and sustainability all come into play when the adoption of a platform, and perhaps a wrap in particular, is part of a wider business model change to a financial planning ongoing-service-style proposition.
“In the situation where the adoption of a platform is part of a wider change, then so long as that is done carefully and thoughtfully, then the simple answer is, yes, we do think platforms are a good thing.”
But Percival warned that platforms can be misused.
He says: “There is scope for misuse of platforms, either willfully or much more likely simply as a result of not looking at the issues and thinking through the problems that could arise when using platforms.
“So, clearly, as a regulator, we need to be alert to those issues.”