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Honister latest: FSA aims to re-authorise most advisers within 5 days

FSA building 480

The FSA says it aims to achieve its voluntary standard of ensuring 85 per cent of advisers are authorised within five days of receiving applications, despite the expected large influx of Honister re-authorisations.

Around 900 ex-Honister advisers are currently looking to gain re-authorisation after the firm entered administration last week.

Speaking to Money Marketing, FSA director of authorisation Victoria Raffe said the regulator had met the voluntary standard for the last year and hopes to continue to reach the benchmark even with the large influx of expected re-authorisations.

She says: “Our voluntary target is to achieve 85 per cent of advisers being authorised within five days. It is something we have chosen to do and we have been meeting that standard for the last year.

“The chances of us receiving 900 applications in one go are pretty small but we would still aim to meet that target regardless.”

Raffe added the biggest barrier to applications not being passed through in time was firms failing to complete their applications fully.

“It is when firms do not evidence fully that the advisers are fit and proper, that is the biggest barrier to authorisations going through quickly.”

Although there has been calls from the industry to fast track adviser applications, the FSA says it will not “cut corners”.

The FSA last week blocked the bulk transfer of Honister Capital advisers to another network due to concerns about historical liabilities and firms’ readiness for the RDR.

“For us the important thing is the outcome, we will not cut corners in terms of the process unless we are sure that it is the right one and we have covered all of the consumer protection angles that we are looking for.”

Raffe said the FSA would aim to complete the large number of adviser applications in the standard five days and would not need to recruit extra resources.

The FSA’s authorisation department employs around 40 people, although this team deals with all areas of financial services.

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Comments

There are 20 comments at the moment, we would love to hear your opinion too.

  1. FSA using common sense for a change.
    If the IFA is “fit and proper” then he should be re-registered ASAP. These guys need to earn a living just like the rest of us.

  2. 5 Days! We have had 4 applications in (via the FSA ONA system) since last Tuesday (3rd July). To date none are authorised.

    When you enter the application via the ONA system you cannot ‘cut any corners’, so how come they are not yet authorised?

    What actually happens is that you will get sent a letter from the authorisations department asking for 49 items to be answered (many relating to the sale of UCIS). They will not accept a scanned copy of the return letter (despite sending a scanned copy of their letter to you), which means the letter will then get held up in their internal post system, then get allocated to the case handler, then re-assessed, then no doubt a request for further information will be sent out………………….5 days, I don’t think so!

    Surely common sense should pre-vail and the FSA check their files to see who is fit and who is not and then authorise accordingly. But alas, common sense and the FSA are incompatible.

    Still on with the drudgery of compiling another 4 page reply to the FSA……………………..

  3. 5 days would be amazing – it took them nearly that in months for me!

  4. Hey Victoria our application has been with you since the 31st May and we haven’t even got a reference number yet!

    Furthermore when we ring up to chase we are told in no uncertain terms that our application will NOT be fast tracked and the standard time frame is up to 6 months for a fully completed application.

    5 Days? whatever…

  5. I have had 2 applications at my firm completed in less than a week I suspected anyone who finds their takes more than a fortnight is not telling the full story and they have ‘fit & proper’ issues which require further investigation from the FSA.

  6. Just chased my application (2:50pm today) and I received a message stating the office is closed call back later. So let me get this right – 40 members in the authorisation dept and yet no one to answer the phone. Treating customers fairly does not exist in relation to the FSA and its customer the regulated firm.

  7. When I complained to the FSA and quoted ” Treating Customers Fairly” I was told they made the regulations so they did not apply to them.

  8. All Burns Anderson, Sage Financial and Honister Partners.
    We all need to take action and write to our local MP’s to explain how the regulator handles these situations. If we don’t, nothing will ever change; this type of situation should not be allowed to happen.
    Re registration should not take weeks, the FSA has all our data, the rules and process needs to be changed. The whole process from the FSA is insane, people who are deemed to be fit and proper one minute, are then not! Through doing nothing different than they have been doing in the past.
    With these tough times we are all living in and the economy struggling, surely putting over 900 people and their support staff out of work is not going to help the British economy.

    I urge everyone to write to their MP and ask them to take action and review the regulation systems, the more of us that do this the quicker this can be changed for everyone in the industry. Take Action Today! As I am sure there will be more firms having problems this year.
    As an industry we all need to start to work together, and make changes in the way the industry is run. it would be great if this matter could be raised in parliament to hopefully promote a prompt conclusion.

  9. In fairness to the FSA they did reauthorise me last year in less than a week and this included them coming back to me for more information.

  10. “Fit and Proper”????

    Like our dear friend Bob Diamond?

    Regulatory balance?

  11. I am usually very critical of the FSA and their many failures but if they can de-authorise as quickly and they do so, I applaud them. Please keep us informed of progress as bills have to be paid and families fed.

  12. As somebody who suffered 15 years ago as a result of the ludicrous way in which the FSA chose to interpret pension review legislation I have every sympathy with all Honister employees. Their futures and to a lesser extent those of their clients are now in the hands of the biggest collection of tossers gathered under one roof.

  13. honestly please 10th July 2012 at 11:37 pm

    the FSA can only do knee jerk , jerk, jerk ,jerk reactions. Victoria, if you read this, please do not authorise advisers who are not worthy. Honister did not fail because of business that was wriiten 25 years ago, but how about last year and this year – get a grip! Do your own DUE DILIGENCE!!!!!!!!!

  14. Agree we must all write to our MP’s to try and sort this out. As for those IFA being sniffy I have no idea how what has happend has happend. We had to battle with complaince to get any pension transfer approved which wasn’t going into a stakeholder for weeks! We have a great business no complaints in 15 years of trading. We do mortgages, protection, pensions (no Final salary or MPP business), no UCIS, no structured about 2 bonds a year the majority ISA’s OEICS and unit trusts all very boring very vanilla all very low risk.

    Now we face the prospect of not being able to trade for (hopefully no more than) weeks. I have my SPS which should prove my knowledge is up to date (otherwise whats the point?) and my compliance record which is excellent (as is the whole firms). Which I assume somewhere along the line the FSA monitored Honisters T&C etc and were happy with it.

    So if I was fit and proper last Monday and the whole point of the FSA register is a centralised data base why are we faced with this?

    Again I urge ever adviser to contact their MP and also even if you are not Honister I would appeal to your good nature in the spirit of the industry to also drop an email to your MP.

    Do not tar us with the same brush, of course there were some bad apples but I am confident out of the 900 adviser the VAST majority are ethical and run good business’s.

    The majority of dubious practises I see (dual agents for overseas properties and then IFA’s setting up the SIPP to allow it) are direct authorised.

  15. honesty please 11th July 2012 at 9:24 am

    I believe Honister failed the last 3 FSA visits. So there is no smoke without fire. They knew that they were in trouble without taking the PI into account, which was a shock for everyone at Honister apart from the top management.

  16. Honesty please 11th July 2012 at 9:41 am

    A large number of Honister advisers have not done any of the exams to get themselves to level 4 and many were not intending to continue as an IFA post RDR. They were however switching and churning and probably thought they had a 6 month window, before they would have to find another job. The early termination of their practices has put a stop to their plans. Honister had this situation under some control (not perfect) which did make it difficult for other advisers who were giving advice on the same type of business. To re-authorise all advisers regardless of track record, quality of advice, RDR readiness etc would be opening the floodgate for the dubious pratices to continue – the only difference being that the new network may not know enough about the adviser’s history or quality of advice, until it is too late.
    Honister kept reasonably good records of business checked and patterns, so this should be checked before re-authorisation – a bit like a reference. The records are easily accessible. Perhaps Honister should have taken a firmer hand with the rogue advisers, but money always plays a part in decisions such as these.

  17. Just wanted to make a comment for those who bemoan the FSA not offering some sort of “auto passport” and just automatically re-authorise, just wanted to provide some balance as i have had (in the past) the benefit of seeing the other-side of this coin….

    It would be bad practice for the regulator to assume that once someone is authorised they continue to meet the requirements in FIT and those set out in APER (code of practice for approved peeps), people can stray from the path over time, and in the Honister example given above, has anyone not given thought to the fact that there may have been a misselling culture within the firm (or any firm) this gives the FSA chance to re-look at the people at the coal face and decide if they continue to be Fit and Proper in light of a bigger picture underlying a firms collapse (which lets face it to which we are not privy) – its an opportunity to weed out those who may not be carrying out business with their clients interests at heart, the bad apples as someone put it on here.

    That takes time, FACT

    ..It would be negligent of the regulator to re-approve or “passport” someone on without looking at them surely…..what if they had been misselling for years and continued to to do, would that not be worse for the end consumer and a bigger failing by the FSA?

    Whilst i appreciate that this is frustrating for those concerned, we work in a system where competence is assessed on an ongoing basis, and is not taken at face value by the regulator once only. Get used to it or dont get wrapped up in the Network model, go directly authorised!

    and John Owen @ 10:34 – before you label the FSA “to*sers” on a public blog, better get your facts straight, the FSA werent around 15 years ago, so somewhat unfair (and ignorant) to blame them for an issue that happend under a totally different regulatory regieme today in 2012 wouldnt you say?!

  18. Having posted early on this subject, I am somewhat taken a-back by the ‘high moral’ stance of Ann O’Namus, honestly please and beatlebum.

    Our practice, which is made up of 11 advisers, some Chartered, others QCA level 4 and some mortgage specialist, has always acted for the sole purpose of providing quality, compliant advice to our clients. Over the last 6 years of trading as an AR of Sage our client retention has been excellent, with no upheld compliants and a high level of FUM and recurring income. We are 85% ready for RDR and have been fee based for a number of years now.

    We took the decision to set up a directly authorised company last year and was authorised on the 2nd April this year. We were in the process of an orderly transfer from Sage to DA, so unlike some of the other unfortunate advisers under Honister we have a ‘home’ for those of our advisers left under Sage.

    It leaves me frustrated and angry when those who probably don’t know the full facts make throw away remarks about the integrity of the majority of good and honest advisers who chose to trade under a network. Just because you may be directly authorised it doesn’t make you any more honest or more qualified or a better adviser than those unfortunate people who are battling to save their businesses and livelyhoods.

    Get real and spare a thought for the poor people who deserve to be treated fairly and timely by the FSA. If re-authorisation is to take place in 5 days, do so, don’t publish a timescale which is unrealistic! Better to be honest and say it could take up to x days/weeks and then everyone can plan and manage expectations.

  19. Hear Hear Pete,
    I understand the issues with auto authorisation etc but there are advisers out there (myself included) who have bills to pay. I really don’t know about this “culture” of misselling it took wees of backwards and forwards with compliance to get a PP transfer approved. So I really don’t know where these crooks were? I assume their were some but not many.

  20. 5 days no chance! ive got an unblemished record in 21 years and they send a letter after one day with 50 questions on it! are they avin a larf?
    how can that be helpful. its their chance without doubt to screen advisers again and delay the process as much as possible. all the questions will be the same for everyone connected to Honister.

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