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Platforms slam FSA £1 cash rebate plans

FSA Buildings Towers 480

Platforms have criticised FSA proposals to allow cash rebates of up to £1 saying it will create further confusion in the market.

In June, the regulator confirmed its intention to ban both cash rebates and payments between fund managers and platforms.

However Money Marketing understands it is ready to allow cash rebates of up to £1 per month to clients from individual funds after discussions with the platform industry.

Transact chief executive Ian Taylor says: “Fund managers will not be able to tell what money should be paid back in units and what is in cash because they hold the investments in bulk. To avoid this kind of issue cash rebates should be allowed to continue in their current form.”

Novia chief executive Bill Vasilieff says: “In our response to the FSA’s last paper we said it should look to ban rebates outright or allow cash to continue. Allowing small cash rebates is going to make things very messy and very difficult to understand for clients.”

The FSA is also set to permit certain payments between fund managers and platforms for things such as fund error corrections and corporate actions.

The FSA, which is due to publish its final rules in the coming months, declined to comment.

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  1. Hopelessly inadequate 20th February 2013 at 11:22 am

    On yet another issue, this is a yet another dogs dinner of a solution; chaos and cost to the industry and at what REAL benefit to clients???…as is the case with so many of their bonkers rules.
    This whole industry is being systematically wrecked by the rank incompetence of these nameless perfect world theoretical purists who have absolutely no comprehension of what is involved in running real world businesses. And whats worse is nobody seems to want or be able to challenge them, not even parliament apparently, as it surely is impossible not to see the damage they are causing, yet nothing is done. Despair!

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