Some preferred platform deals between distribution firms and platform providers could be in breach of RDR adviser-charging rules, according to the FSA.
Speaking at The Platforum’s adviser roadshow last week, FSA technical specialist Rory Percival (pictured) said some deals would fall foul of the rules to be implemented on January 1, 2013.
Percival says: “This is an area of interest to us. We have suspicions about certain arrangements between platforms and distributor firms or adviser firms that do appear to be or will be in breach of adviser-charging rules come next year.”
He added that particular remuneration arrangements are attracting attention from the FSA.
He said: “We do not have any concerns about firms negotiating lower charges for customers. There are some arrangements where the firm is receiving remuneration from the platform and, depending on the nature of that remuneration, it is possibly in breach of the charging rules.”
In its platform policy statement, published in August, the FSA said: “The adviser needs to take into account whether being on a platform is in each individual client’s best interests and ensure any personal recommendation to invest via a platform is suitable.”
The Lang Cat principal Mark Polson says: “It is important the FSA looks at these deals to ensure adviser firms are making money through adviser-charging and that alone. These kind of deals show a clear conflict of interest that needs to be managed.”
Many networks and other big distributors have preferred platform arrangements in place.