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Nic Cicutti: Apfa rebrand will further blur the lines

Some time in the next six or seven weeks, a proudly held acronym will be handed back to its rightful heirs who will, thereafter, hopefully be able to hold on to it in exclusivity for all time.

No longer will it be possible for anyone to confuse the Australia Indonesia Families Association for an organisation that solely represents independent financial advisers, especially after 13 November.

To be honest, it was always slightly unfair of Aifa in the UK to steal the initials: after all, the more illustrious Canberra-based namesake has been in existence for almost 35 years. Moreover, judging by its home page, the Ozzie organisation’s younger members certainly appear to be more appealing than most of their UK counterparts, albeit the little Aifa aprons they wear would look quite fetching at the occasional Masonic event over here.

Some of you may be asking how it is possible at this stage to assume that, after 13 November, there will not still be two claimants to the Aifa name. Let’s get real: a continuing financial crisis at the trade body and a dwindling membership unable or unwilling to make a successful transition to fee-paid advice are hardly likely to vote against allowing restricted advisers to stay on as members.

Which brings me neatly to the column by Money Marketing’s newest addition to its roster of columnists. Emma Simon comes with a proud pedigree at the Sunday Telegraph – and her remarks are spot on when demanding that the big banks should be paid far more attention by the regulator than it currently does. Some of their activities, including the “revelations” of juicy super-bonuses forbank salespeople certainly bear investigation.

In that respect, it is interesting to note that Financial Conduct Authority chief executive designate Martin Wheatley is talking about “shooting first and asking questions later”. According to last week’s report in MM, the regulator can only take action against a director if they were “knowingly concerned about a contravention of the listing rules”.

It now wants this to be tightened so that action can be taken against a director who “ knew, or should have known” of the contravention. The FCA is also talking about publishing warning notices at an earlier stage and using far more readily its new powers to intervene in risky products and ban them from being sold.

Actually, while I am in favour of certain rule changes, including amending the threshold for taking action against individuals to be lowered, I would rather the FCA just asked the right questions a lot sooner than it has to date. Had it done so in a number of cases in recent years, from Arch cru at one end to sales of PPI at the other, the massive problems faced by millions of savers and borrowers might never have arisen.

But the problem with the final part of Emma’s column – and a similar viewpoint voiced by Moneysavingexpert gazillionaire Martin Lewis a few weeks ago – to the effect that “there should also be far clearer distinction about the service that ‘advisers’ in bank branches offer,” is that it sounds to me a bit like shutting the stable door after the horse has bolted.

Emma understandably wants “woolly terms” like “wealth manager”, “financial consultant” and “planning adviser” to be scrapped. She says anyone selling a financial product – in a bank or otherwise – should either be an adviser, whose services are paid for by the consumer, or else simply called a “salesman”.

Sadly, there is a difficulty in terms of determining whether commission-paid recommendation to buy a product is always classed as advice or as a sale.

Besides, after 13 November, the leading organisation formed to defend and perpetuate the “independent” aspect of financial advice will be changing its name to the Association of Professional Financial Advisers.

Both IFAs and restricted advisers will be free to call themselves “professional financial advisers” and the FCA won’t give a stuff. Why should it: its predecessors at the FSA happily dismantled polarised advice a decade ago, enthusiastically backed by the OFT and the last government.

Increasingly, I am drawn to the conclusion that if the FCA and organisations who were once defenders of the so-called “gold standard” of advice (I bet we will not ever again hear that description of IFAs from an Apfa mouthpiece) are unable to promote the concept, it will fall upon new entities to do so.

I’ve always had slight doubts about Gill Cardy’s outfit, the IFA Centre, over the fact that it does not appear to have enough high-profile and well-respected backers to provide it with the momentum she needs to make hers a credible organisation for independent advisers.

The IFA Centre, a bit of a boring name by the way, is run on a shoestring, partly because it has not many members and also because the industry doesn’t want to fund an organisation whose members prefer to give financial planning advice rather than just sell product.

But beggars can’t be choosers. If the Aifa/Arfa name change goes ahead on 13 November, as I expect it will, genuine IFAs should prepare to decamp. Just don’t expect to keep the old name: that now belongs Down Under.

Nic Cicutti can be contacted via


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There are 5 comments at the moment, we would love to hear your opinion too.

  1. Spot on Nic,
    AIFA, sorry APFA, is now the plaything of the providers to promote why Restricted is Independent-ish and clients shouldn’t worry about them not being Independent as they have chosen to specialise!

    IFAcentre certainly has a small budget as it is only, and will only, be funded by IFAs. This is so, so important and will ensure that the incredible start made by Gill, particularly in getting in front of the all party group in the commons talking Arch Cru, will continue.

    It deserves more support from IFAs, we need more noise to promote our position over the coming months and years.

  2. Why couldn’t AIFA, and IFA Centre for that matter, come up with their own definition of what an IFA is rather than blindly and unquestioningly accepting the FSA’s new definition?

    What’s wrong with supporting whole of market advisers, some of whom chose to specialise and so are restricted (but let’s face it they’re not really)?

    The starting point should be proper debate about what exactly is important to the client, but they don’t get mentioned very often on these boards…

  3. The IFA Centre will always be a small player. Partly this is due to the perverseness of advisers who want representation but aren’t prepared to pay for it. Another reason is that the numbers of IFAs will fall massively leaving a small potential membership.

    Add to this the fact that Gill couldn’t make her fee-based practice work and you have a recipe for under-achievement.

  4. Currently I am an IFA. Next year I will be a restricted whole of market adviser.

    Apart from the nonsensical descriptive nothing will have changed.

    Let’s forget about these subtle distinctions, there will always be superbly skilled restericted advisers and highly qualified wallys.

    The FSA is responsible for this confusion. Imagine how confused the consumer will be?

  5. Alan Lakey@11:36
    Spot on!

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