Nic Cicutti: My old mate Garry Heath

Not many people will know this but I was once Garry Heath’s best mate. OK, that may be a slight exaggeration but it was certainly the closest he and Nfifa, the precursor to Aifa, came to a friendly relationship with a national newspaper journalist.

For several years, I wrote in Nfifa’s monthly magazine about regulatory matters from a consumer perspective. The feedback from Garry and his colleagues in Covent Garden, where Nfifa was then based, was that my comments were valued.

More important, certainly from Garry’s point of view, Nfifa was always given a fair shake in any copy I wrote. I might have disagreed with what he told me but his viewpoint would never be unfairly reported in my news story – although comment pieces were another matter.

Garry, Nfifa and myself bumbled along in this way for several years and probably would have continued to do so, had it not been for two problems. The first was that I increasingly saw elements of consumer detriment in aspects of some, though not all, Nfifa activities. The second, even bigger problem for both of us was that I could not ignore it. If I disagreed with something Garry and his chums were doing, I had to write about it somewhere.

Of course, when you do that there are bound to be costs. And so it was that after a reasonably mild column, by today’s standards at least, my space in Nfifa’s journal disappeared. One month, I was receiving deadline details from Sam, one of Garry’s assistants, the next month, zip, nada, nothing. When I enquired, I was told my column had been terminated.

I have never held a grudge against Garry for that. It had gradually become obvious over several months there was a divergence of opinion between us.

In my subsequent news reporting at least, I continued to show him and Nfifa the same level of fairness I always felt was appropriate to a representative of a major constituency in the financial services industry. Even today, I still respect Garry for what he did to pull the IFA sector together back then and the strength of purpose he showed in representing its interests.

The difficulty for Garry Heath is that the world has changed but he does not seem to have spotted the fact

But there is a big difference between admiring his past work and accepting that what he is saying today is correct.

In the past year or two, Garry has again come to the fore in matters involving IFA interests. Occasional comments have turned into more regular outings on the trade newspaper circuit. Garry’s profile is rising again.

To a large extent, his renewed ascent is a consequence of the weakness of most other trade body representatives. The folk memory of a pugnacious Garry still has the potential to rally a few diehards around the banner of resistance to excessive regulatory intervention – or what he regards as excessive.

The difficulty for Garry is that the world has changed but he does not seem to have spotted the fact. Last week, he wrote an online article for Money Marketing, urging a delay in the introduction of the RDR.

Garry quoted a survey by MyTouchstone, an IFA profiling database, which found that only 5 per cent of IFAs are RDR-ready, as compared with Aifa, whose own statistics suggest the figure is 75 per cent. “So who do we believe?,” asks Garry rhetorically, opting for the far smaller number that “proves” his point.

In his article, he claims the FSA never did “a proper impact assessment” of the RDR on IFAs. Wrong. It actually published a number of detailed studies, some of whose figures have been used at various points to try and show, unsuccessfully in my opinion, that thousands of advisers will leave the industry and millions of their customers will suffer.

Garry then throws out a mass of additional and unquantifiable statistics – such as only 5 per cent of IFAs have obtained their level four qualifications – all conveniently posed as questions to save him from having to justify the lack of any evidence to justify them, before finishing with: “This child of vested interest needs to be put back in the nursery before it does any more damage.”

For someone like Garry even to imagine that the FSA or the FCA will consider delaying the RDR is sad.

What is even sadder is that in playing to his assumed gallery, he does not seem to realise time has moved on. As more than one person told him when his article was published online, his call for a delay means thousands of IFAs who used the four years’ notice they had to obtain their qualifications and reorganise their businesses are being kicked in the teeth.

As more IFAs qualify and come up with charging structures that allow them to practise successfully after 2012, the number of IFAs listening to Garry will steadily decline. Will the last one out please turn off the lights?

Nic Cicutti can be contacted at nic@inspiredmoney.co.uk

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Comments

There are 37 comments at the moment, we would love to hear your opinion too.

  1. There are advisers (like me) who have been adviser charging for several years, have their level 4 and so on and still belive that to avoid consumer detriment and in view of changes in Europe and of FSA to FCA that RDR should be a series of steps (i.e. some may need to be delayed) rather than a single dedline. So agree with both Gary AND more importantly the Treasury Select Committee who the FSA senior managament chose to ignore before practically resigning on mass to go to places like PWC, Dubai and we are yet to find out where Hector’s new house will be.

  2. Exasperated Me 8th June 2012 at 11:05 am

    IFAs don’t listen to anybody and I can’t blame them, they are independent in mind, body and soul. I for one don’t see how such a diverse and dispersed crew can be represented by a single body because of “another cost too far” and of course the variety of needs.

    There will be a fair number of casualties, clients included, and that is the only really sad part here Nic. No point picking on people who have an opinion, flawed or otherwise, simply because it is unacceptable to you.

  3. I have to agree with this article. Whether we agree or otherwise, RDR is coming in 6 months time. Anyone who pretends there may be delay or even cancellation is doing us all a dis-service. IFAs may need help in RDR preparation; what they don’t need is false hope (if that’s the right word).

    The world has moved on, and we have all had to move with it. There are just 2 options for IFAs – be RDR ready by December, or leave the business. That’s just how it is.

  4. Nic As usual my view is at odds with some of the stuff you say. Firstly I would like to know where you bought your crystal ball (as I want one). It is to do with your statement “As more IFAs qualify and come up with charging structures that allow them to practise successfully after 2012”. There are no doubt a lot of IFA’s who are changing their models but not one of us knows wheter it will allow us to trade at all post January “1th” next year, never mind trade successfully. We can only hope/pray we have got it right. 2ndly – regarding the so called “kick in the teeth” to all of us who have previously got our QCF4 done and out of the way at various points in the last 4 years. Just how is it a kick in the teeth if the RDR is delayed until it has all (if not most) of the many consequenses of consumer detriment removed? There is nothing to stop those fully support the RDR who are allegedly ready to start going with their model from next year from doing so. Meanwhile the wonderful Canary “Wharfiens” should take on board all the comments that show the bad side of RDR & consumer detriment resulting therein and bring them back to the drawing board to get a proper fix put in place. Personally speaking, even if a few thousand of the tens of thousands of IFA’s out there feel it is actually a kick in the teeth to them if RDR is delayed, it is a price well worth paying if it means that the vast majority can have the benefit of a revised set of rules that actually work in real life. Regulator’s, advisers, providers, fund houses, platforms etc and not to forget the clients can operate in a system that is workable, at an affordable price, and in a way that is sensible then who would be the losers? If it is going to have to be done then do it right or not at all. Currently we have a train heading to a dead end that is going to destroy an entire industry plus all current & future consumers and you are worried about a few thousand pontificators? Are you totally bonkers?

  5. Jeremy Newbegin 8th June 2012 at 2:09 pm

    Nic, you say “As more than one person told him when his article was published online, his call for a delay means thousands of IFAs who used the four years’ notice they had to obtain their qualifications and reorganise their businesses are being kicked in the teeth.”

    Why should they feel that way Nic? They are all now highly qualified and will seemingly stand out as a better option for seeking advice. All their hard work has given them much better knowledge to enable them to do their jobs.

  6. How is it possible to write an article on this point without addressing the issue of the sovereignty of parliament?

    There may or may not be a case for deferring the RDR but the FSA’s arrogant dismissal of the TSC’s request for a delay and the assertion that the FSA is not answerable to anyone anyway raises this whole issue beyond a spat between people in the profession and those (like Mr Cicutti) who are on the periphery, and takes us into a constitutional area of much greater significance.

    I believe I may have the honour of being a “usual suspect”; I might be more impressed by being let into the history of Messrs Cicutti and Heath’s relationship if I felt the bigger picture was being addressed at the same time.

  7. Taken a few years to get taste of those sour grapes out of your mouth then Nic ? and you have let yourself down in the process.
    Plus you are woefully wrong to boot as Marty has highlighted above.
    I suppose you are entitled to your opinion but then you have the luxury of being a jorno, so RDR is not going to bother you other then the extra money you pay your IFA if you use one.

  8. Given that those who are ‘RDR compliant’ and fee charging already (although why this is held out as being a new thing is beyond me – there have been RDR style fee based advisers for as long as there has been regulation !!!) there may actually be a really good argument for delaying RDR particularly regarding commission ban.

    It will allow everybody to see which business model actually works post Jan 2013 – fees or commission.

    As I have said many many times before all you RDR/exam/fee/wealth junkies have nothing to fear if you are right because market forces will determine the winners and the losers (just as they always have) and all clients will naturally migrate to you wont they !!.

    I know which one my money would be on – what about you NIC ??

    GO ON let the market decide I dare you !!

  9. As usual we have the usual suspects moaning that RDR will be the ruin of financial services when in fact RDR are only asks two main things:

    1 Minimum qualification levels in an attempt to raise standards throughout financial services.

    2 Banning of commission to stop advisers hiding their true earnings from a consumer by hiding them in products. I wonder how many of the individuals that constantly write about the doom and gloom of financial services are actually disclosing their full commissions including trail commission, as I really don’t see the difference between an advisor fee and commission that is if you charge the same across all products and most importantly disclose them.

    To Bair Cann

    I really do think you need a lesson in English law as there are clear examples where Parliament does not have overall power e.g. Judiciary. Parliament sets laws and its the judiciary that interprets and enforce those laws for the good of everybody independent of parliament.

    The FSA was set up as an independent regulator and therefore cannot be tampered by Parliament unless Parliament changes the law – end of story!

    Do you really think that providers have not done a tremendous amount of work in the background to prepare for RDR, because if they haven’t they deserve to go out of business.

    Stop being naive guys and just get on with the job and study like mad to get qualified sorry to be so blunt.

  10. @peter Herd. Much if what you say is correct but the bottom line is that many IFAs give advice to normal people on average incomes who cannot afford to pay ‘up front’ fees and will be the poorer for it. Many advisers will fail on the RDR business model and numbers will reduce. You can be smug that you deal with high net worth individuals but did you notice the effect of lower income and company numbers on the mortgage broker? The FSA increased their fees!!! Think this won’t happen to you? Don’t forget to switch the light off Peter?

  11. Soren Lorenson 8th June 2012 at 3:37 pm

    There are too many loose ends to the RDR and it should be delayed.

    The professional qualifications could be enforced on 1/1/13 if that’s going to make Peter Herd happy but the commission ban needs more thought because the unintended consequences are now too great to ignore.

    The FSA should long ago have worked with HMRC to devise a simple VAT exemption for financial advice so that RDR did not result in 20% consumer detriment.

    Slightly tiresome article this week that smells strongly of sour grapes.

  12. “The difficulty for Garry Heath is that the world has changed but he does not seem to have spotted the fact”

    Oh but I do Nic I really do.

    However unlike you – I don’t like what I see.

    I see a regulatory process which is increasingly to the detriment of the consumer.

    I see a regulator that is not responsible to anyone; particularly the Parliament that created it.

    I see that regulator and the FSCS will increase its levies as they see fit creating taxation without representation.

    I see an attempt to reserve the UK’s major industry only for big players, including the government.

    I see millions of clients separated from the advice
    they need.

    I see many clients reporting to the MAS which is
    not responsible for the advice given

    I see those fee charging advisers who believe they have inherited the earth slowly realising that they have to fund ever increasing FSCS charges from a diminishing number of advisers.

    I see the cheerleaders for RDR starting their Level 6 campaign on January 3rd 2013.

    I see with huge sadness – a trade association too financially feeble and too riven to do anything about

    So am I stuck in the past Nic? Maybe – but my past saw the IFA sector increase its market share by 10%. My past saw the UK representing 85% of all private pension funds in the EU. My past saw Independent advice developing all over Europe. My past saw polarisation. My past saw 12m UK consumers getting advice from the IFA sector. My past had a regulator held to account.

    Above and beyond RDR and even this industry; I see a rachet clicking away from liberty and towards a dependent populace enslaved by a state determined to control every element of our lives.

    When I took the NFIFA job in 1989 at the end of my speech at the NEC I quoted the 1700’s statesman Edmund Burke “All that is necessary for the triumph of evil is that good men do nothing.” In our current situation it is even more relevant.

    Perhaps I can add another “Better to be despised for too anxious apprehensions, than ruined by too confident a security.”

  13. Soren Lorenson 8th June 2012 at 4:30 pm

    @Garry Heath | 8 Jun 2012 3:45 pm

    Nice one Garry…

  14. Let me first say that I don’t deal with just wealthy clients I deal with every day individuals who seem to be able to fund upfront fees with no problem when they find a service that they value.

    Are we really saying that the average consumer can’t afford services when they need them after all they seem to be other to find money for expensive holidays or new kitchens when needed.

    I don’t buy the argument that commissions should stay because advisers are willing to see loads of people that can’t afford advice. Sorry, but are we truly saying that you are willing to do a full financial review with no product sale and loads of advice provided free of charge. Right, pull the other one, I bet you’d actually prequalified the appointment and if it didn’t sound right to you then you would never book the client in your diary. Maybe we should be a bit honest here as it’s clear that some people aren’t. I charge what I think is a fair consultation fee and clients get a great deal of information and a written report based on that consultation. If there’s any additional products to be set up then we have a level charging structure for that service which includes an ongoing servicing if the client wishes to receive an ongoing review.

    To Garry Heath

    The past of our industry includes oversold mortgages to the general public by overhyping the housing market and coming up with products that increase the level of mortgages that people could take up. I wonder how many advisers turned around and said I really don’t think you should do this as I think you’re overextending yourself.

    After all isn’t it the place of a professional adviser to sometimes give advice that the client may not actually like hearing like “I don’t think that this mortgage is affordable for you and maybe you should look something a little bit more affordable or continue saving”. Could be that the adviser is so caught up with the Proc fee that they receive based on the size of the mortgage! I know RDR does not include mortgages at this stage but maybe it should!

    Your industry also has a few skeletons in the cupboard like structured bonds, pension transfers, and even endowment miss-selling etc

    Not once have I heard an individual who is against RDR mention the benefits of RDR those been higher standards and knowing what you are paying for.

    All I hear is endless articles and responses seem to claim the world will come to an end in the industry will stop when in fact the industry will go on and evolve and provide higher standards of service because the market will demand it. If you don’t provide the service you won’t get paid maybe that’s what some people on here truly fear because they provided a service on selling a product and never seeing the client ever again.

    FSCS fees

    I think that because we will see an increase standard of professionalism within the industry and there been a break between products and advice we should see a reduction in FSCS as complaint numbers should be reduced and hopefully with it product failure. I truly hope one day the regulator will introduce a product FSCS fee instead of basing it on the actual advice as it is often the products themselves that cause the problem.

    Non-Advice

    As advisers what we should be really concerned about is non-advice services as I truly believe that this is going to be the real problem post 2013 as banks look to market products like structured products on this basis.

    We should stop fighting about RDR and just realise that RDR is actually our friend, yes I said friend as Banks will not be able to compete in the advice industry, as their whole model is about selling product they are not interested in ongoing service. I suppose this is the real test for the industry as we move towards a service rather than a sales force selling a product. A good example of the service is an accountant and that’s what we should aim to be in future the service provider that people value and TRUST.

  15. “My past saw Independent advice developing all over Europe.” Mr Heath you provide an interesting list of some industry developments over the years, but surely that one is made up.

  16. Fitting for the IFA rump to follow someone whose pomp was in the last century. In this century customers expect a professional in any walk of life to be clear about what is being charged, and be qualified to a respectable level. Even that poster child for the refusniks, Mark Garnier came to recognise this, and so led the TSC to find in favour of the RDR tenets. What IFAs need to grasp is that the world of politics and regulation is not going to learn to understand them – they have to understand how that world operates. And if it has one rule it is this: if you can’t make the case for the man in the street, then you are just special pleading so don’t bother. For five years, IFAs failed to provide a credible evidence base for customer detriment on RDR, and that is why they are derided in the committee rooms of Westminster just as they were in Gary’s time. Now they don’t need a drum major, the blogosphere does the damage. It’s time to grow up.

  17. Garry Heath – Game, Set, Match

  18. @Garry Heath
    Please stop being so ridiculously melodramatic. Burke had something more important in mind than a few IFAs whinging about the ending of commission (and in any case that quote is wrongly attributed to him as any schoolboy should know).

    Next we’ll have some juvenile idiot quoting Niemöller.

  19. Let me first say that I don’t deal with just wealthy clients I deal with every day individuals who seem to be able to fund upfront fees with no problem when they find a service that they value.

    Are we really saying that the average consumer can’t afford services when they need them after all they seem to be other to find money for expensive holidays or new kitchens when needed.

    I don’t buy the argument that commissions should stay because advisers are willing to see loads of people that can’t afford advice. Sorry, but are we truly saying that you are willing to do a full financial review with no product sold and loads of advice provided free of charge. Right, pull the other one, I bet you’d actually prequalified the appointment and if it didn’t sound right to you then you would never book the client in your diary. Maybe we should be a bit honest here as it’s clear that some people aren’t. I charge what I think is a fair consultation fee and clients get a great deal of information and a written report based on that consultation. If there are any additional products to be set up then we have a level charging structure for that service which includes an ongoing servicing fee if the client wishes to receive an ongoing review.

    To Garry Heath

    The past of our industry includes oversold mortgages to the general public by overhyping the housing market and coming up with products that increase the level of mortgages that people could take up. I wonder how many advisers turned around and said I really don’t think you should do this as I think you’re overextending yourself.

    After all isn’t it the place of a professional adviser to sometimes give advice that the client may not actually like hearing like “I don’t think that this mortgage is affordable for you and maybe you should look something a little bit more affordable or continue saving”. Could it be that the adviser is so caught up with the Proc fee that they receive based on the size of the mortgage eg the higher the mortgage the higher the proc fee! I know RDR does not include mortgages at this stage but maybe it should!

    Your industry also has a few skeletons in the cupboard like structured bonds, pension transfers, and even endowment miss-selling etc

    Not once have I heard an individual who is against RDR mention the benefits of RDR those been higher standards and knowing what you are paying for.

    All I hear is endless articles and responses seem to claim the world will come to an end in the industry will stop when in fact the industry will go on and evolve and provide higher standards of service because the market will demand it. If you don’t provide the service you won’t get paid maybe that’s what some people on here truly fear because they provided a service on selling a product and never seeing the client ever again.

    FSCS fees

    I think that because we will see an increase standard of professionalism within the industry and there been a break between products and advice we should see a reduction in FSCS as complaint numbers should be reduced and hopefully with it product failure. I truly hope one day the regulator will introduce a product FSCS fee instead of basing it on the actual advice as it is often the products themselves that cause the problem.

    Non-Advice

    As advisers what we should be really concerned about is non-advice services as I truly believe that this is going to be the real problem post 2013 as banks look to market products like structured products on this basis.

    We should stop fighting about RDR and just realise that RDR is actually our friend, yes I said friend as Banks will not be able to compete in the advice industry, as their whole model is about selling product they are not interested in ongoing service. I suppose this is the real test for the industry as we move towards a service rather than a sales force selling a product. A good example of a service is an accountant and that’s what we should aim to be in future the service provider that people value and TRUST.

  20. Sorry Garry, but I just have to come back on some of the points you raised in your answer to me. I notice, by the way that you failed to reply to any of my specific points, once again responding by making vague and inaccurate generalisations.

    So what I’m going to do is take your points one by one, quote them in full and give my reply afterwards.

    You say: “I see an attempt to reserve the UK’s major industry only for big players, including the government.” Where is the evidence for that? Ironically, the evidence increasingly shows that big providers are backing away from sales of regulated products because they are not being allowed to sell them in a so-called “simplified” manner. That potentially benefits IFAs.

    You say: “I see many clients reporting to the MAS which is not responsible for the advice given” Rubbish. I’m as critical of the MAS as you are but there is no evidence whatsoever that it is replacing the work of IFAs. We both know it, so why say it?

    You say: “I see those fee charging advisers who believe they have inherited the earth slowly realising that they have to fund ever increasing FSCS charges from a diminishing number of advisers.” On the contrary, I suspect fee-paying advisers (and many others) are becoming increasingly frustrated at the activities of SOME commission-charging advisers who sold people rubbish products, have taken the money and want to pretend it had nothing to do with them.

    You say: “I see the cheerleaders for RDR starting their Level 6 campaign on January 3rd 2013.” I don’t see that happening, but if it did happen within a reasonable time frame of say three to five years, I’d have no problem with that ambition.

    You say: “I see with huge sadness – a trade association too financially feeble and too riven to do anything about” I agree that Aifa has failed in its mission. But ironically, the direction you’d want it to go would leave it even weaker and less able to defend its members.

    You say: “My past saw the IFA sector increase its market share by 10%. My past saw the UK representing 85% of all private pension funds in the EU. My past saw Independent advice developing all over Europe. My past saw polarisation. My past saw 12m UK consumers getting advice from the IFA sector. My past had a regulator held to account.”

    You rather arrogantly seem to be claiming the credit for all of those facts. The reality is that you personally and Nfifa generally had nothing to do with that success. Tens of thousands of conscientious IFAs, most of who were NOT members of Nfifa, achieved that.

    As for IFAs holding Fimbra to account, your concept of a group of the regulated holding their regulator to account is outrageous. It should always be the other way round. As a regulator Fimbra was weak and inexperienced, despite the good will of many of its leading figures and, as a result, it failed totally to regulate members effectively.

    The mis-selling of personal pensions was one classic example among many during this period. Despite your attempt to pretend that IFAs were blameless, they contributed between 10% and 12% of all the Phase Two non-urgent cases (95,000 out of 845,000 cases where reviews were carried out) and 15% of the 650,000 or so urgent Phase One reviews. The compensation figures agreed after reviewed were carried out ran into many hundreds of millions of pounds, possibly billions.

    Yes, this figure was less, proportionately, than the amount of personal pensions actually sold by IFAs when compared with bancassurers and life company salespeople. But it still involved real life people who were being denied redress because of some of your members. The sums involved were vast.

    Incidentally, your trade body fought a bitter battle against the review, claiming in your statements to the Treasury Select Committee that the compensation figure would be much higher, making absurd claims as to the number of advisers who would be driven out of business – and in the process forcing retired and dying pensions mi-selling victims to wait years for their money. Or they died before they received it. How does that make you feel?

    That’s why, in the end, despite my strong support for the concept of independent financial advice – which I have always held dear – I had to break with you and Nfifa and tell the truth as it was and not as you wanted it to be.

    And that’s also why, if that’s the past you want to return to, I hope you never get your wish.

  21. Without wishing to rehash old arguments and without aiming to infuriate Peter Herd to yet more posting – something we can all do without – it is pertinent to recall exactly what the RDR intentions were.

    Callum McCarthy suggested the distribution model was broken (2006). If he was right, which most sane people dispute, there was a number of mecahnisms available to fine-tune rather than destroy the mass distribution.

    The original RDR discussion paper in 2007 positedthe aim that, “Consumers are capable and confident” and, “Information for consumers is clear, simple and understandable”. Again, here we are, five years down this desolate path, and we find that consumers exhibit less confidence and that under the RDR information will be less understandable.

    Dear client, I am a new model adviser and I am transparent with lots of exam passes. I am independent, in a way, because I search the whole of the market but, as I only work in certain areas I cannot use this appellation. Don’t worry, I am charging a fee but really it can come out of your investment so it’s not a fee…really”

    I can see lots of consumers being happy with this.

  22. @Nic Cicutti

    Nic you stated, “The mis-selling of personal pensions was one classic example among many during this period. Despite your attempt to pretend that IFAs were blameless, they contributed between 10% and 12% of all the Phase Two non-urgent cases (95,000 out of 845,000 cases where reviews were carried out) and 15% of the 650,000 or so urgent Phase One reviews. The compensation figures agreed after reviewed were carried out ran into many hundreds of millions of pounds, possibly billions.”

    I happen to have the exact figures derived from the FSA under a FOI request.

    Phase 1
    IFAs – 11% of redress paid
    Banks/Providers – 89% of redress paid

    Phase 2
    IFAs – 12% of redress paid
    Banks/Providers – 88%

    When assessing these figures you need to inject the distribution information supplied by Charles River Associates in their research for the ABI

    Regular Premium Pensions
    IFA market share – 79%
    Bank market share – 7%

    Single Premium Pensions
    IFA market share – 83%
    Bank market share – 5%

  23. To Alan

    Can you honestly say that a client knows what they have been charge for under commission and that every advisor discloses thier commission – right pull the other one.

    You do n’t like what I have to say because you know that our industry has a problem with non-disclosure and RDR will put that right!

    I think from some of the post of late I have just as much support then you – maybe it just that people who moan about RDR write more about it.

  24. One last thing Alan you never did answer the question of whether you are level 4 qualified ?

  25. @ Peter Herd – Do you mind me just asking which body is/has issued your SPS please, it is relevant to a lot of your comments, which I’ll explain once you confirm the accredited body.
    If you google me or look on linked in, enough will come up for you to be able to check my background out.

  26. Peter Herd

    You cant help it can you – you are priceless !!

    Did I recall from somewhere that you only came into this industry becasue of FPC ?? – good god !!

    and some of your pearls of economic wisdom are – well !!

    Why is it you preach that your way is the only way Peter ??

    If you are right everyone will come to you it really is that simple. I dont tell anybody how they should trade why do you ? More importantly thats why RDR will not work

    It is for the two parties involved in any transaction to determine how/how much payment is made. Next you’ll be telling me that there should be a regulator and a uniform price for cardigans !!!

    99% of this job (as is the case in many others) is finding the client and 1% is selling (YES SELLING) the solution – When I came into this industry 30 yrs ago (no this is not the GOOD OLD DAYS speech) there were lots of people like you around with all the exams and technical knowledge the one thing they didnt have was any clients to sell to – funny that !!!!

    Oh and by the way, you are in the overwelming MINORITY – but let me say once again you crack on !!

  27. Charter Institute Of Bankers in Scotland I have a level 5 Diploma in Investment Planning

  28. @ Peter Herd, Alan and Derek – Peter phoned me for a chat following my posting and having spoken to him and knowing Alan (and of Derek), can is suggest you actually talk to one another, kiss and make up as you actually have an awful lot more in common than NOT, despite what the tone of the postings on here have been.
    @ Anonymous | 11 Jun 2012 8:24 pm _ Why shoudl Alan or anyone else dignify you with a reply when you hide behind “anon”. Grow some…..

  29. The number of IFAs on here that are so scared of change is astounding. The arrogance to assume that the way business has been done until now is the best and only way is just plain wrong when one looks at the blantant product bias. Don’t believe me then just look at who sell most of the GPP business in the UK and amazingly it’s all the providers that pay out indemnified commission.

    @Peter Herd – keep up the good work in putting some of the frothing in its place and finally speaking sense. Most advisers accept RDR is coming and are getting on with it. Granted, it could have been implemented better by the FSA but it ambitions can only be to the benefit of the industry in the long run.

  30. All very interesting but has anyone ever bothered to ask a broad range of clients what they want or think?

    After all, if it’s not about them then what is it about?

  31. To Grey Area

    If you want the answer go and ask some people what they think of Financial Adviser in general – I do not think you will like what you hear. We as an industry have been so scared by miss-selling and commission bias we need for once and for all to have real change and most important disclosure that clients sign for.

    To Anonymous | 12 Jun 2012 1:51 pm

    Thanks for your support – I know that I am not allow in my view point

  32. This discussion is pointless unless anything can be done – and unfortunately the IFA community (whether pro, or anti on RDR) is entirely powerless.

    The reason for this is that it has built no political capital. It keeps wanting to shoot blanks, as if it believes it has a right to be listened to. It has to earn that right by exhibiting progressiveness, maturity, and humility over an extended period – then and only then will policymakers and regulators begin to listen.

    So in the absence of that – just keep on arguing on blog sites …it does get read, and it is no longer possible for the reputation of the sector to diminish any further. Just don’t expect to be treated with any credibility by anyone who matters

  33. @ Alan Lakey

    Actually, the figures you quoted are not dissimilar to those I used. All you are “proving” is that the average amount of compensation was slightly smaller in the case of IFAs relative to the amount of cases where reviews were carried out and offers of compensation made.

    And I also acknowledged that IFAs sold a far higher proportion of pension products than the rest of the tied/direct salesforces. So it’s not clear to me what amazing point you are trying to make that hasn’t already been made.

    The point I am making – for the avoidance of doubt – is that up to 150,000 victims of pensions mis-selling/transfers/opt-outs, came through the IFA distribution channel.

    Oh, and did I mention endowments? Splits? Just about every other dodgy product for which thousands of IFAs are now paying the price through huge hikes in their FSCS levies?

  34. @Nic Cicutti

    Well Nic, we do seem to have some major philosophical differences which shows how data can be manipulated (FSA take note).

    The Pension Reviews were a travesty. PASS gave out guidance that rather than evaluate whether the case was compliant it was better to assume non-compliance (due to 1989 advice being subject to 2000 hindsight thinking) and, as a result, the majority of cases reviews showed as a ‘loss’.

    Why was this? Well, conveniently, the calculations were made during the 2000-2003 bear market which meant that cases that previosuly showed as profitable for clients now showed as unprofitable and thus compensation became due.

    Let’s not forget that the real reason that so many cases were reviewed and compensated was due to the iniquitous PIA insisting that “R U Owed” letters were mailed to every potential claimant and to this was added the vile television adverts showing people being shortchanged when buying ice cream.

    Disgusting and indefensible.

  35. The Cicutti/Lakey/Heath argument here is old soldiers seeking to fence with their relative perceptoins of ancient battles. No one cares.

    What matters is what happens now. How are IFAs going to restore credibility with anyone who can infuence the future? Gary and Alan would say ‘keep shouting’ but if the message fails to recognise the zeitgeist then it just hurts everyone. Nic doesn’t need to deliver any solutions – he can just point fingers where he chooses.

    Right to left thinking: Who matters? (Barnier, Hoban, Webb, McClymont, van Hulle, Wheatley)

    What do they think about UK advisers? (not much to be proud of)

    What can be done about that? (Clue: the answer is not ‘tell them they are all wrong and UK advisers are all wonderful but misunderstood and victimised’)

  36. @ Alan Lakey

    Wrong again.

    Actually, most of the reviews, both Phase 1 and 2, were carried out in the late 1990s and 2000, before the crash. I wrote an article for the FT in late 2002, with good actuarial calculations carried out on our behalf, showing that the levels of redress paid to those who were not reinstated into their former occupational schemes were vastly inadequate in terms of returning them to the status quo ante and they were highly likely to be facing massive losses unless markets picked up. The past decade’s flatlining stock marketmakes that likelihood a certainty.

  37. Garry/Nic.

    We’re all entitled to our views. It won’t surprise either of you whose sentiments I broadly agree with.

    However, we need to ask ourselves two questions:-

    1. After 25 years of regulation, lobbying by many vested interests, including ours and many new regulatory initiatives, is the consumer actually better or worse off at the end of this period?

    2. Whatever your answer is to the first question, will RDR be a step up or step down from where we are now in terms of consumer benefit and protection. No need to answer this one. Let’s leave it 5-10 years and wait and see.

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