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MM leader: Six months on and FSA still drags out Park Row saga

It is now well over six months since Park Row was wound up and the situation for many of the firm’s advisers looks like it is getting worse rather than better.

Many advisers are still waiting for news about their reauthorisation having not been able to work or look after their clients for over half a year.

Advisers have complained about some of the results of the past business reviews being carried out on behalf of the FSA, which are being used to judge whether advisers will be reauthorised.

There is concern that Park Row’s parent company Royal Liver will chase advisers for some of consumer redress it has been ordered to pay by the FSA.

The Park Row situation has turned into a total shambles and much of the blame lies with the regulator.

The FSA has yet to give us a reasonable explanation as to why it did not allow a bulk reauthorisation of former Park Row advisers so they could continue to service their clients. This could then have been followed up with a stringent review of advisers to ensure their competency.

Surely this policy would have been a better way to proceed rather than cutting advisers’ income for over six months and restricting their clients’ access to financial advice?

The situation many of these advisers find themselves in is a direct result of senior management failings within Park Row. Any misguided attempts by Royal Liver to chase advisers for excess professional indemnity payments would leave a very sour taste.

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Comments

There are 6 comments at the moment, we would love to hear your opinion too.

  1. It is clear that the FSA just thinks that everyone in the industry just has bottomless pockets, some advisers must almost be ruined because of this.
    How about they just stop their staff’s wages for 6 months and see how many can survive.

    They probably believe the OTE wages advertised.

    I dislike the whole FSA’s attitude to this industry.

    If they were on sensible wages in normal priced offices with sensible expense costs they would have been an awful lot better than they are.

    I am sure the normal staff on normal wages who work there shudder at the behaviour of the higher ranking staff.

    The UK must stamp out this sort of behaviour, the country cannot stay wealthy no matter what government does to industry, the government needs taxes.

  2. Exasperated me 27th May 2010 at 10:26 am

    I predict that the regulator will be far more involved in the initial vetting of advisers as well as in the ongoing scrutiny compliance with of FIT.

    However, it must not deem advice to be usuitable on the basis of charges alone because it would lose on appeal.

  3. We were fit and proper on the 12th November but not the 13th! 240 advisors all became unfit and non-proper in just one day and the answer from the FSA is what? Oh yeah there isn’t one! These applications for reauthorisation are and have been sitting on a desk (sorry in a locked filing cabinet because of data protection) for what reason?

    If we, without any complaints, upheld or not are not fit and proper who is?

    If we are not financially fit then six months without any income will help.

    And our clients, the ones that the FSA are there to protect, what a great idea to take away their trusted advisors just as there is a change of government, pension age is increasing and turmoil in the markets.

    Normally I would have been proactively contacting my clients over the last few months but the FSA say that I am not allowed to. I cannot phone them to say they need to do this or that and they are left all alone and without any advice whatsoever (even if it was wrong advice at least they could get compensation!). No the FSA’s view is let’s not authorise the advisors (who they didn’t find at fault in the fines they have announced) and punish both the advisor and their clients.

    What a great example of a great regulator for the rest of the world to emulate. (Sarcasm over for now)

  4. Martyn Sinclair 27th May 2010 at 1:16 pm

    go to the county court and issue a writ costing £80 claiming damages up to the maximum allowed. The FSA will probably ignore the writ and they wil have a CCJ.If you guys have a case, then stop whingin on and go for the jugular.

    Yaaaayyyyyy, REGULATOR HAS CCJ

    Bet they wont allow that to happen !!

  5. This is a mess and the wider implications are deeply worrying.

  6. IFA Defence Union 27th May 2010 at 2:55 pm

    How much did KPMG charge for this and who pays?

    In many cases the sole reason for declaring so many files ‘unsuitable’ was the charging structure of the receiving scheme.

    Although nobody can guarantee that any policyholder tranferring a pension pot from say Friends Provident with profits fund will be better off it is a fact that comparing illustrations of future benefits is not the appropriate method of deciding whether a sale is suitable or not.

    Park Row was responsible for ensuring that these advisers were ‘fit and proper’, the FSA was responsible for supervising Park Row. Who pays the price for this “collective intellectual failure”? Not the FSA, that is for sure.

    Why was Royal Liver allowed to transfer so many of their direct sales people into a completely alien environment where the supervision was so ineffective?

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