It is a basic principle of an ordered and civilised society that those who want to change the status quo are required to explain the proposals in detail so that those who are affected can judge whether they are being off-ered progress or a return to a darker age.
In proposing CP121, the FSA has singularly failed to pass this test, not only to the IFA community's satisfaction but apparently to those members of its own staff tasked with promoting the concept.
My old warmongering self rails against the injustice of it all. The temptation to remount the old war horse and gallop at this new windmill is almost overwhelming but I realise that some change is inevitable and the forces that could be mastered for a full-frontal assault are few and weak.
I am more furious at where it leaves the consumer than where it leaves the industry. However you package these proposals, there are millions of consumers who are happy with their independent advisers, their actions, the way they are paid and the advice they give.
Unless the FSA is minded to destroy that relationship, IFAs may be forced to rebrand or repackage but their clients will remain with them.
My concern is for the consumers who are deemed to be “socially excluded” and in whose name these proposals are being propounded.
It is this group of average and below-average inc-ome investors who are going to become the targets of misinformation on a massive scale.
There is no clear idea within CP121 on how multitied advisers are going to be policed to ensure that they do not pass themselves off as being independent.
One can imagine marketing departments all over the UK already designing sales packs with phrases such as: “We have researched the market and have decided that this group of products offer the best all round value to our clients.”
This should be translated as: “We have done the rounds of the most desperate product providers and these offer us the best profit for the least effort.”
Neither is there any illumination on how the clients of IFAs who decide to multi-tie are going to be serviced if they happen to have products beyond the tie.
There are already millions of orphaned clients. They come from banks that suddenly decided that the IFA sector was not for them.
The direct-sales operations that have either closed down or do not have any meaningful way of servicing the clients of departed associates and from a great number of departed IFA firms.
While politicians have got over-excited about orphan funds, a far greater scandal surrounds the millions of clients who have been orph-aned from their source of advice, often by structural change, and probably do not realise that their needs are no longer being attended to.
A move to multi-tie would lead to millions of new clients either being orphaned or sold new policies rather than having older policies supplemented – a licence to churn.
Not that the socially exc-luded are the only ones being misinformed.
IFAs are already being bombarded with information from all sorts of vested interests that seek to force them into actions which they might regret.
While a few IFAs might be handsomely rewarded for selling their businesses or tying with product providers, many others may find themselves in wholly unhealthy relationships before the die is cast.
IFAs would be well advi-sed to appraise themselves on what CP121 really says and get that information from independent, dare I say, impartial sources. See you at the roadshows.
Garry Heath is chairman of Impartial