If ever there was a regulator intent on meddling with things which are neither broken nor in need of fixing, then surely it must be the FSA.
I refer, of course, to the latest unhealthy and unwarranted interest being shown in Pep and Isa transfers, not to mention the continuing obsession with the validity of past performance.
Here is a simple scenario. Mr Joe Ordinary comes to see me because he thinks his Pep with Garbage Life in their UK (lack of) growth fund is not doing very well – not just lately but for the past five years since he was persuaded to invest £6,000. What can he do with it? What should he do with it?
I prepare for him a table showing, horror of horrors, the 12-month, five-year and 10-year performance track records of all four of Garbage Life's funds. This makes pretty depressing reading and confirms what he had been thinking before he came to see me.
Then I show him the corresponding figures from a choice selection of about 30 funds, with a notional risk rating for each, selected from the very diverse range available through our preferred fund supermarket product.
No guarantees for the future, of course – and it will cost him a small percentage to transfer. But where would he rather place his bets for the future? Where does he wish he had had his money for the past five years? Has he, until now, understood the concept of risk versus reward?
Does he not wish that he had understood five years ago the difference between a tied agent and an IFA? And, while we are asking a few questions of Mr Ordinary, does he think it would be a good think to mess up polarisation?
Well, of course we all know the answers to these questions. This is just a simple, very close to real life scenario in which thousands of conscientious IFAs are involved every other day of their working lives.
What does the FSA know of such things?
WDS Independent Financial Advisers, Bristol