The Personal Finance Society is concerned that this month’s retail distribution review paper will create a “fudged area” between sales and advice.
In an interview with Money Marketing at the PFS annual conference in Birmingham this week, new PFS president Paul Lothian said he believed the RDR may create a middle ground between advice and sales that will allow advisers to continue to operate as they do now.
He said: “My fear is that there will be a fudged area between advice and sales where advisers can continue to work with provider-influenced remuneration and no increase in qualifications or standards. That is business as usual and would allow parts of the IFA sector to continue unchanged.”
Until now, the PFS has steered clear of the RDR debate over the sales/advice split and remuneration, suggesting these were trade body issues.
Lothian said he was concerned customer-agreed remuneration will not be rolled out industrywide.
“My hope is that it will because I believe that remuneration should be agreed between the customer and adviser but I think the regulator may fall short of introducing that across the board.”
Lothian also said that he believed the FSA still harbours doubts about the value of financial advice.
He said: “There are elements of the regulator that do not believe in the value of what we do so we have chosen to continue our theme on the value of advice to convince not only the regulator but clients too.”