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Isa guides “may spark mis-selling scandal”


An outraged IFA is calling for direct brokers to be banned from printing Isa guides claiming they could spark another misselling scandal.


Dennehy Weller & Co believes direct brokers that claim in their Isa guides they have researched the market to recommend the best Isa providers are breaching FSA regulations because many providers pay cash to appear in the guide.


The IFA argues that consumers are being misled into believing they are receiving unbiased advice about which Isas are the best on the market.


But, it claims some companies are being recommended on the basis of the cash they are splashing out to advertise in the guide regardless of their past or current performance.


The IFA says its also concerned some guides break regulations by blurring the distinction between execution-only business, which has a different set of regulatory rules, and business where advice is given.


It also warns that that the situation is set to become much worse with a host of direct brokers setting up internet sites which are being used to publish the guides.


Money Marketing raised the issue two weeks ago amid IFA claims the guides confuse investors. More than £15m Isa guides were being distributed in the run up to April 5.


Dennehy Weller & Co managing director Brian Dennehy says: “This is dangerous as experienced investors are being misled into believing those products appearing in the guides are suitable for their own needs.


“This information must be impartial as it is obvious that if an Isa provider was not prepared to pay large sums to advertise they would not be included in such guides.”

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