The FSA has confirmed that IFAs can use a single platform to service “the majority” of their clients as long as it is in line with clients’ best interests and leads to suitable advice.
In its consultation paper on platforms, published last week, the FSA says: “Assuming that use of a platform is in line with the client’s best interests and leads to advice that is suitable (and it is crucial to note that use of a platform will not be the right solution for every client), we accept that an independent firm may be able to use a single platform for the majority of their clients.
“However, a number of concerns arise with this approach and we would expect that when an independent firm uses one platform for the majority of its clients, it ensures that the platform does not hinder the firm’s requirements to meet the independence rules.”
The FSA says it does not expect a platform to hold every retail investment product in the market as long as advisers consider off-platform investments “where appropriate”.
The regulator adds that if a company is going to use services such as guided architecture or model portfolio tools, it expects the firm to take steps to ensure that the tools are “unbiased”.