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Fund firms send out warnings

The UK&#39s biggest fund manager Fidelity has spoken out against the Sandler review, questioning the industry&#39s need for a full-scale review and warning it could destroy consumer confidence.

Fidelity says the Sandler consultation paper underestimates the sophistication of the UK investment industry and “misjudges the crucial role of the IFA”.

It warns that over-regulation may shatter consumer confidence, creating a sense of distrust rather than building a strong savings culture.

Fidelity also warns that any attempts to control pricing or product structures, such as commission caps, would hamper the industry&#39s ability to produce diversified and innovative products.

Jupiter&#39s response to the consultation also gives a warning not to underestimate the importance of the IFA, adding it believes Cat-standard products are not in the best interests of consumers and send out the false message that cheap is good.

Fidelity managing director Richard Wastcoat says: “We remain unconvinced of the need for this review and concerned about where it is heading. The consultation paper underestimates the sophistication of the consumer, misjudges the crucial role of the IFA and fails to differentiate sufficiently between different types of products.

“We would caution Mr Sandler and his team not to try and fix what is not broken. The confidence of the consumer to keep on saving is at stake and we encourage him to work with us to build it, not destroy it.”

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