View more on these topics

IFP says changes in plans blur channels

The Institute of Financial Planning has slammed the FSA for dropping proposals to separate advisers into general advisers and financial planners.

Chief executive Nick Cann says the distinction between advice and sales needs to go further and a higher definition of advice is needed. He says consumers will not be able to differentiate between the two channels as advisers will still be selling products and insists that greater clarity is needed.

He says: “This does not move the market forward to where we want it to be. We support the move towards higher standards and qualifications but the advice and sales channels are too blurred, especially given the current economic situation.”

Intethic compliance director Jonathan Purle says the split between advice and sales could benefit advisers by restricting the banks’ ability to dominate the mass market. He says primary advice, as proposed in the discussion paper, would have given the banks an “FSA-safe” method of controlling the market.

Purle says: “This could have developed into a serious barrier to competition for the rest of us looking to deliver guided sales and assisted purchases.”


  • Clear separation between ‘advice’ and ‘sales’ channels

  • Advisers to achieve minimum qualifications, possibly diploma level but not as high as chartered

  • Possibility of higher qualifications for ‘focused advice’

  • On-the-job assessment for existing experienced advisers to demonstrate the requisite minimum levels of competence and knowledge as an alternative to examinations

  • Advisers to offer independent

    advice, which must be whole of market

  • Sales services strictly non-advised execution-only or guided sales

  • Multi-tied and tied advisers likely to fall under sales category

  • Sales channel designed to encourage higher levels of savings could be extended to include protection products

  • Money guidance service to provide information and steer consumers toward regulated advice and sales services

  • No plans for a read-across of the RDR to the mortgage market due to current market conditions


  • Financial advisers to operate remuneration arrangements agreed with customers and determined without input from product providers

  • Product providers can continue to organise payments to advisers from customers’ accounts or investments

  • Factoring will be permitted as long as the product provider has played no part in determining how much remuneration will be paid

  • Recognise that many firms in the corporate market would not want to or are unable to move to a pure fee basis

  • Potential for some form of maximum commission agreement


  • No case to suggest that the benefits of a 15-year long stop would outweigh the customer detriment from time-barred complaints
  • Recommended

    Inside Track goes into administration

    Property investment firm Inside Track Seminars has been put into administration. Vantis managing director Jeremy French and director Glyn Mummery are joint administrators.

    Recovery position

    It is a natural reaction to be bearish amid current uncertainty over the depth and duration of the economic slowdown and investors have mostly flocked to defensive sectors. It is interesting that the normally cyclical commodities sector is trading at elevated prices despite recessionary concerns. Conversely, banks, retailers and housebuilders have been punished.


    News and expert analysis straight to your inbox

    Sign up


      Leave a comment


      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