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Industry bodies blast FSA’s RDR consumer leaflet

Industry bodies have hit out at the FSA’s “profoundly unhelpful” RDR consumer leaflet, saying the information conflicts with industry guidance on independent and restricted advice.

An FSA RDR consumer factsheet, entitled Changes To The Way You Get Financial Advice, states independent advisers will be able to offer advice on all types of products and “restricted advisers will either specialise in specific areas, such as pensions, or offer limited advice on a smaller range of products.”

But in final guidance on independent and restricted advice last month, the FSA said specialist firms can still call themselves independent in certain advice areas such as income drawdown, annuities, and ethical investments.

Institute of Chartered Accountants in England and Wales financial services faculty technical manager John Gaskell says: “This is profoundly unhelpful and is merely confusing the issue of independent and restricted advice, particularly in light of current discussions around referrals.”

Sifa managing director Ian Muirhead says: “It is an indication that one department in the FSA is not talking to another department. This is a problem, because the regulator is contradicting itself.”

IFA Centre managing director Gill Cardy says: “One of the fundamental points of the RDR was that consumers had much greater clarity about the advice they were getting. Perhaps the FSA should come up with something more constructive?”

An FSA spokeswoman says: “What is fitting for the industry will not be fitting for the consumer. Independent and restricted advice is something which is nuanced, but in communicating the RDR to consumers we need to be quite high level.”


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There are 23 comments at the moment, we would love to hear your opinion too.

  1. Cue Brian Rix racing out of Canary Wharf with his trousers round his ankles. Brilliany stuff again from our regulators.

  2. Left hand / right hand? Incompetence? We need to be ‘high level’, why not just try to be accurate? If the FSA within itself and with the industry cannot be clear about the distinction, how can any consumer, at any level, be expected to understand the difference?

  3. Just go’s to show how much the FSA real knows about the consumer, let alone the industry.

  4. Derek Bradley ceo PanaceaIFA 25th July 2012 at 9:11 am

    An FSA spokeswoman says: in communicating the RDR to consumers we need to be quite high level.”

    A two page PDF is very high level is it? God help the consumer if the regulator has to be relied upon to get the message out.

    Too little, too late.

    Our London IFA conference pointed this communications failure out along with a serious inaccuracy about ISAs highlighted by APCIMS.

    Also, the same FSA spokeswoman says: “What is fitting for the industry will not be fitting for the consumer”. I think that is a little condescending.

  5. They could not organise a celebration in an a beer producingestablisment!!
    The whole industry or professon if you prefer is becoming a total farce.

  6. So it’s “high level” to give the impression that “restricted advisers” may be specialists whereas “independent advisers” will be able to “offer advice on all sirts of products”?

    So if I was looking for top notch advice on e.g. pensions then would I not be better going to the specialist?

    The “nuance” here hits youo between the eyes and is not fitting for either the industry or the consumer.

    It should be made clear that independents can specialise just as well as restricted whilst continuing to offer advice on a whole of market basis.

    The “nuance” that I pick up here is that the FSA seem to be incapable of clear thinking and clear expression.

    At what point did the FSA think it unnecessry to run the proposed leaflet past someone who could perhaps have spotted the wholely inadequate representation of the facts?

    Ian Coley
    Medical Investment Services

  7. Heaven help us! It is bad enough that we in the industry have to endure ‘Regulation Speak’, they now want to impose it on a public who in the main don’t want or are not interested in engaging. ‘High Level’ what does this mean to the man in the street (let alone us in the industry)?

    What the need are high level pigeons doing what they do best over No. 25. Pity cows can’t fly!

    As to the distinctions. I (with others) have been pointing out for years that these distinctions area complete dog’s dinner. I have actually tried explaining this to ‘ordinary’ people. Both clients, friends and relatives. The results are always the same – a look of pity, bafflement and a suggestion that I may need psychiatric help.

    It has been suggested by the Canaries that we should be explaining the differences to our clients. Why should we? This was thrust upon us, it is absolute rubbish and we really don’t want the FSA insisting we make complete fools of ourselves in front of our clients. We can leave that to them – they have proved over the past 4 or 5 years that they are very good at it.

  8. Well Mr John Gaskell of the ICEAW widen your definition of ‘independent’ so you can refer to Restricted Specialists then?! Reasonable?

    As for the FSA – Did you really expect anything other than that? I hope Cole & Co are enjoying their private sector jobs and having a good old laugh!

  9. In fairness to the FSA nobody in the industry has been able to explain the real implications of RDR to me adequately so far, so it is a bit unfair to expect the Regulator to be able to.

    On the upside, I haven’t come across a client yet that has any interest in the matter at all, so it probably isn’t a major issue. Funny though.

  10. Total incompetence
    These highly paid people have an inept understanding of the Financial Services Industry and are so far detached from reality. They are ruining a once vibrant industry and depriving the general public from good honest financial advice.
    We need common sense leadership at the FSA and not posh boys sipping Pimms all day!

  11. Justin Credible 25th July 2012 at 9:40 am

    This is simply descending into a pathetic farce. I am proud of what I do for my clients, despite the constant headwinds. Thiose clients constantly tell me so and if they stop that will be the time to go Can anyone at the FSA say they are proud of what they achieve, of course not, they wouldn’t know a real consumer if they but them in the rear. The individuals at a lower level are on the whole great people, those with clout and influence are so out of touch and arrogant that it beggars belief (although two decades of this incompetence make it entirely believable in FS). Then again there are quite a few vacancies popping up at the top as so many have moved to pastures, or troughs, anew ….

  12. Here is proof (if any was needed), that the FSA has totally lost touch with the needs of the public and through an anonymous committee approach to communication, has delivered another unintelligible message for which no one will ever be held to account.
    If half a billion pounds of public money was being spent in this way, every year, these unelected clowns would have been history years ago.

  13. What do you expect from a FAILED regulator?

    It will be gone on 1 January 2013, and its place in history will be assured as the regulator whose failure and incompetence BANKRUPTED Britain!

  14. Get ready for this one re the MAS site, If you try to retrieve a quote by typing in the http: code you get hijacked by “The” (The investment Discounts on line Ltd) a private business which looks like the MAS site

    MAS inform me that IDOL are hosting partners of their website who host their annuity comparison tables.

    Am I missing something here or does the whole thing stink to high heaven?

  15. Larry in London 25th July 2012 at 10:30 am

    ‘High Level’ is code for ‘the public is thick’.

    That’s what the FSA said and that’s what they meant. They are calling the public thick.

    As we get nearer the time when brown stuff starts hitting the air conditioning, expect more gobbledegook from the Canary Whingers. If the Canary W*kers, with all their power and majesty, cannot explain RDR to the public, it is a serious indictment of the whole RDR mess. They set out to fix something that wasn’t broken and the mess they’ve created proves it.

    If it ain’t broke, don’t fix it.

    If all this wasn’t so serious it would be hilarious.

    The CW crowd are totally incompetent. Total incompetence in everything but inflating their salaries.

    Love and kisses


  16. I pity the folk at the FSA that have now been left with the task of justifying this complete shambles thrust upon them by the arrogant incompetents that have flown the rather stinky nest (pun unintended but perhaps accurate). They dreamt up a ‘good’ idea in some very expensive committee room having never ever given or received financial advice themselves or met anyone who has and have just been trying to justify it ever since.

  17. “What is fitting for the industry will not be fitting for the consumer. Independent and restricted advice is something which is nuanced, but in communicating the RDR to consumers we need to be quite high level.”

    Nice to see they have embraced plain english.

  18. Plea to Martin Weatley

    Please just halt the process – concentrate on a smooth transition to the FCA – and then spend the next two years studying and dealing with unintended consequences and issues arising, put them right and bing it in in 2015, thus tying in timescale wise with Europe.

    Magic – everything solved.

  19. Campbell Macpherson 25th July 2012 at 12:50 pm

    The FSA will remain unhelpful until they wean themselves off their obsession with products.

    Whilst technically accurate, the description of ‘Restricted’ advisers offering “limited advice on a smaller range of products” is highly misleading on two fronts – firstly it equates advice with product selection which is nonsense and precisely what the FSA was trying to avoid ion the first place, and secondly it implies the client will receive a lower quality of advice from a Restricted Adviser, which again is nonsense. The financial advice will not be restricted, merely the product choice (if indeed the solution is a product. The choice of solution may be less than the mythical “whole of market” range but that is a completely irrelevant distinction.

    Our initially-well-intentioned regulator has dug itself into such a deep political hole with these meaningless labels, that it is no surprise that all it can do at this late stage is keep on digging. It will need a change of guard to put a halt to this product fixation from Canary Wharf.

  20. How sad that after 12 years the FSA still aspires to ineptitude.

    Let’s hopethey get there because this is nonsense.

  21. Michelle White 25th July 2012 at 2:00 pm

    Do these comments reach anyone with power to influence the outcome of RDR, such as FSA senior management, Parliamentarians, other journalists?

    If not, how can we ensure that they do reach these people and are given priority by them?

  22. Terence PO'Halloran 25th July 2012 at 4:22 pm

    The blind leading the bewildered.

    When will someone rid us of these incompetent ‘know all-no nowt’ individuals.

    And they are talking of making their leader, Adair Turner, the next governor of the Bank of England. ‘Insult to injury’ does not come into it. The man at the head when the biggest ‘bust’ in banking history for decades is now to be put in charge of the pricipal.

    Bring back Bob Diamond; all is forgiven.

  23. Anonymous

    “Do these comments reach anyone with power to influence the outcome of RDR, such as FSA senior management, Parliamentarians, other journalists?

    If not, how can we ensure that they do reach these people and are given priority by them?”

    I don’t want this to sound confrontational but…..;-)

    I find a good method is to use my real name and send them to the people you mention.

    It’s a numbers game I’m afraid – the more pressure brought to bear the more notice is taken.

    I have had some good responses from my MP, Andrew Tyrie and others in positions of influence and it does bring about change – eventually – if it is needed.

    Unfortunately anonymous carping and oblique name calling isn;t quite so effective.

    Ian Coley
    Medical Investment Services

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