View more on these topics

FSCS is playing by its own rules

In response to Loretta Minghella’s letter about the Financial Services Compensation Scheme, headlined, Inaccuracies over FSCS powers, it seems to me that one of the biggest problems for the industry is the “rules” by which organisations such as this operate.

For example, Minghella denies that the FSCS hounds retired IFAs over old business based on hindsight reviews, yet the pages of Money Marketing and those of countless other publications are positively littered with accounts of exactly such campaigns of persecution.

No comment is offered, for example, on how the FSCS has determined the liabilities about which it has been writing to the former principal of the firm that was the subject of my original letter and to his former non-equity partners, most of whom left him and his business well over a decade ago.

How can the retrospective application of standards not defined at the time that the advice was given be deemed to be anything other than a hindsight review? I am sure that the industry at large would be keenly interested to know by what reasoning Minghella deems such reviews to be on any basis other than by hindsight.

Who initiates these reviews of a firm’s past business? Who undertakes them? By what methodology? In what way is the advice given deemed all these years later to have been deficient? None of this information has been supplied and no opportunity has been offered to any of the FSCS’s targets to raise any challenge on any of these points.

Right from the word go, the FSCS holds all the cards, shows them to nobody and has been writing threatening and possibly, by any standards of proper justice, quite unfounded letters to people who had no stake in the business, no (meaningful) say in how it was run, never received a penny of its profits while they worked there and, least of all, received any of the proceeds from its eventual sale several years after they had left.

In the world of regulated financial services, justice is a concept decidedly different from that which applies in the outside world. But, hey, the FSCS has its rulebook and if the rulebook

says what it does and how it does it are okay, then for people like Minghella, that is all that matters and what anyone else may think clearly does not.

Name & Address Supplied

Recommended

Widows gives 5% bonus on W-P funds

Scottish Widows has announced a 5 per cent return on its with-profits fund over the last 12 months. It says a £50 a month mortgage over 25 years will pay out £38,136 – £4,825 above target. Widows says it will retain last year’s regular bonus rates on its conventional with-profits policies and unitised with-profits policies, […]

BTL has added 90 to monthly repayments

The buy-to-let boom has pushed up mortgage payments for many borrowers by 90 a month, according to a study by the National Housing and Planning Advice Unit.The unit, which advises the Government on housing affordability, believes that the massive rise in BTL over recent years has had only a moderate impact on house prices and […]

Mystic Mehrdad

The Diary was amused to learn that the mortgage market has a budding psychic in its midst in the form of mortgage commentator Mehrdad Yousefi.At a recent industry awards bash, Wave’s director of distribution and sales revealed his skill as he predicted a succession of winners of the awards.His talent was impressive at the start […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com