I have no complaints against HSBC myself but am I alone in being uncomfortable over any large financial firm being able to hire the former chief executive of FOS or for that matter FCA or FSA or PRA?
You are not alone, Joseph, although I suspect that Ceeney’s perspective on FOS may change from crossing the fence (or should I say going through the revolving door). She probably sees her tenure at FOS as a success but I do not. Turnaround times have increased dramatically due to FOS failing to deal appropriately with the volume of spurious and vexatious complaints, which has encouraged a huge increase in these. She may now get some idea why advisers get so angry about the FOS.
We clearly need rules that state no regulator can work for a regulated firm for two years after leaving the regulatory body. At that point, hiring would be on ability, not recent locus. At
a time when we are expected to be free of inducements this is an ill-judged move.
Online comment related to article: Sesame confirms advisers have six months to go restricted
Independence is nowhere near as difficult to achieve as some of the big networks suggest. As a smaller network, we have taken notice of what our members wanted and worked with them to ensure that they can meet the independence requirements.
All that is needed is a structured approach to CPD (covering all RIPs), a properly constructed set of qualification questions to identify clients for whom more esoteric products might be suitable and a comprehensive range of independent research on all RIPs (which can be bought from third parties).
Of course there is a little more work but we think that it’s worth it to deliver the best possible outcome for clients.
This holy grail of achieving independence is not the mountain many make it out to be.
We work closely with ‘professional connections’ and while (for example) VCTs, EISs, etc, aren’t mainstream, we need to have them available to us and we discuss them if and when they may be appropriate.
I have seen it said that there are those who are still clinging on to the IFA brand while not being truly IFA – but I also suspect there are others who were already delivering the post-RDR
IFA level of coverage and simply could carry on regardless as the new rules didn’t affect their existing holistic approach.
Here is the FCA guidance on what constitutes independence
What do you need to do if you want to call yourself independent?
You need to:
•Consider a broader range of products than before (retail investment products)
•Provide unbiased and unrestricted advice based on a comprehensive and fair analysis of the relevant market
•Inform your clients before you provide advice that you provide independent advice
I am not sure why anyone thinks that the above is particularly difficult
The parameters for independence may not be particularly difficult to understand.
The problem is the amount of work and costs involved in complying with them, particularly when it comes to keeping up with and comparing all the platforms for every new investment and, so the networks tell us, even for top-ups.
Anecdotally, many IFAs have a panel of just three or four platforms and claim therefore to be independent but I don’t see how they can be – you either compare them all for every case or you restrict to just one.
How can anything in between constitute independence? I agree with Xeno – most of this can be avoided simply by choosing one platform that does almost everything that the great majority of clients need.
And we still don’t know just what Sesame’s parameters for restricted will be.
If it’s to be an opt-out from advising on ETFs, VCTs, EISs etc, a tie to just one or two selected platforms but WoM for everything else, then what’s the problem?
As just about any SJP partner will attest, the public are not bothered at all about dealing with someone who has elected to opt out from having to compare and analyse the possible suitability or otherwise of every potentially suitable retail product on the market.