FSA opens the box To depolarisation

The FSA has called last orders on polarisation, opening up distribution of financial services and opening itself up to claims of massive consumer detriment with a box-ticking disclosure regime in one fell swoop.

FSA consultation paper 166: Reforming Polarisation: Removing the Barriers to Choice, published this week, creates any number of distribution models and allows hybrid firms to move between tied, multi-tied or independent depending on a client&#39s needs.

The Consumers&#39 Association brands the proposals a charter for confusion while providers claim it allows IFAs to choose their future without being forced into making irrational decisions.

Under the regime, IFAs will be able to remain as they are or choose a mix and match proposition of advising on products from a single provider, some or all of a panel of providers, the range of the marketplace or any combination of these.

The FSA&#39s solution to policing this new marketplace is a box-ticking-led disclosure document telling consumers about the level of advice they receive.

Aifa director general Paul Smee says: “The great beauty of polarisation is its simplicity – the one word you would never use to describe this is simplicity.”

Consumers&#39 Association senior policy adviser Mick McAteer says: “If the key objective is to provide consumers with better access to advice and products, then they have failed. This is a step backwards that stacks the odds against consumers even more than before.”

Norwich Union director of marketing Robert Fletcher says: “We are a lot more positive about the abilities of IFAs to choose a business model that is best for their business without being pushed into making irrational decisions.”

Michael Philips proprietor Michael Both says: “The problem is one of clarity of duty. The client of an IFA knows he is being well served, the client of one of these new distributors must adopt a buyer beware attitude.”