A group of IFAs co-ordinated by Sway chief executive Jon Maguire is seeking £1m to challenge the legality of the Financial Services and Markets Act.
It is setting up Justice for IFAs, a lobbying firm, to argue that the Act breaches European human rights legislation.
Their efforts will be based on three main points. The first is that where any inquiry may lead to criminal charges, which it says is the case with all FSA probes, it is the right of anyone under
investigation to expect the protection of common law. The group argues that, as the FSA can take away IFAs' licences if they refuse to co-operate, it is in breach of European law.
The group also believes the ombudsman's £360 charge for
complaints – even if they are later dismissed – is against natural justice. It wants the charge repaid where the complaint is not withheld.
Its final argument is that the FSA should stick to its handbook and not engage in retrospective action.
Maguire says: “I hope that IFAs and some providers will support the group so we can all operate in an orderly market that is not against itself. In the eyes of the consumer, the financial services industry is appalling.”
FSA spokesman Rob McIvor says: “The FSMA is being reviewed by the Government. I am sure it will be pleased to assess the group's submissions.”