The FSA’s move to rein in misleading promotions by protection providers has been slammed as “woefully inadequate” by consumer group Which?.The FSA says it has uncovered evidence of scaremongering in product literature. However, Which? says the regulator should impose severe penalties on guilty providers rather than just writing to warn them. A recent FSA investigation into promotions by 25 providers found that some cited statistics on illnesses where not all forms of the illness are covered by the policy. Some providers were found to have made unsubstantiated claims about the price, uniqueness and coverage of the policy or to have given the false impression that critical illness is a simple product. FSA spokesman David Whitely says: “Our financial promotion regime is designed to ensure that promotions are fair, not misleading, and balanced. If customers feel they do not understand a product based on the promotion, they sho- uld seek advice.” Which? principal policy adviser Laurence Baxter says: “The FSA’s response to tackling these problems is woefully inadequate. Instead of imposing the severest sanctions possible under their own rules, which might involve slapping punitive fines on the companies in question, they are taking the almost conciliatory approach of writing to the firms asking them to stop. “It is a bit like a policeman watching a bank robbery and then telling the robbers that they should not have done it.” Lifesearch senior technical adviser Kevin Carr says: “It is difficult, if not impossible, for any non-advisers or non-protection experts to address these issues without giving advice and, therefore, the real issue is whether or not such financial promotions are misleading customers by giving advice.”
Our industry finds itself forever evolving through different Governments, rules, regulations and, dare I say, scandals.
Savills plc is reporting a strong first half result showing pre-tax profit of 19.9m, up 15 per cent on 2004 results. The property group’s interim results to June 30, 2005 show a turnover of 158.2m up 12.7 per cent on 2004 results. Basic earnings per share for the period rose from 23.5p last year to […]
Net retail investment sales in July reached their highest level in two years giving renewed hope that investor confidence is returning, according to the Investment management Association. Total net sales were 852m, the highest since July 2003 when they reached 863m. Equities were almost twice as popular as bonds, selling 367m, with 192m for bonds. […]
Research from GE Life on equity release appears to show an alarming lack of knowledge of the product among IFAs. It predicts that the market will triple over the next five years and could reach 125bn by 2009. But it cautions that intermediaries must be careful to avoid another misselling scandal.
By Tracey Dickson, marketing consultant There are almost 7 million carers in the UK – that’s around 10 per cent of the population who provide unpaid care for a disabled, seriously ill or older loved one.1 But according to a report from the charity Carers UK, 20 per cent of people providing 50 hours or more of care […]
- Top trends
News and expert analysis straight to your inboxSign up
Latest from Money Marketing
The Financial Services Compensation Scheme will automatically compensate hundreds of clients of a collapsed discretionary fund manager, but other investors will have to wait another five months to get their money back. London-based Beaufort Securities has been investigated by both the FCA and US authorities. An indictment from the US Department of Justice alleges that […]
Fiducia managing director on ‘good old-fashioned’ customer service in the digital world Anthony Scott is adept in the art of communication. As an adviser and a novelist (he has written the novels ‘On Ashover Hill’ and ‘The Birthday Gift’) it is crucial for the Fiducia Group managing director to engage and build a rapport with […]
The FCA has reiterated its warnings that advisers outsourcing defined benefit transfer advice to firms with relevant qualifications cannot divorce themselves from responsibility for the eventual recommendation. While existing FCA rules require additional qualifications to advise on DB transfers, and the FCA has written to all firms who have DB transfer permissions as part of […]