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PIA board fights in IFAs&#39 corner with vote for polarisation

While its parent regulator, the FSA, dithers and delays its decision on polarisation, IFAs have found an unexpected ally in the PIA board. Following an invitation from the FSA to comment on the misguided London Economics report, the PIA board has given a full and clear endorsement of polarisation.

How refreshing that someone over at Docklands has enough savvy to understand independent advice is in the best interest of the consumer and the industry as a whole. In its response to the LE report, the board says “consumer understanding of the marketplace through polarisation is an important public good, which could be damaged by substantive change. Blurring the choice of channels of advice and distribution would not encourage consumers to shop around.”

Questions must be asked why polarisation is still in doubt when it has had the backing of such eminent bodies as the PIA board, the Financial Services Consumer Panel and the Consumers Association.

The FSA and the Treasury should hurry up and come clean about what their true intentions are over the issue. If necessary, an open debate should be held over such a vitally important issue. We should not bow to the whims of civil servants with axes to grind against the industry. The tide finally looks like it could be turning in favour of polarisation. It does not take a brain surgeon to know it makes sense for the consumer.

What a strange week it has been. First, we have seen the FSA back the industry by refusing to buckle under external pressure and engage in a full review of endowments sales and now the PIA has given its approval to IFAs. What a week, indeed.

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