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Poll reveals advisers uncertain over TCF

Aifa chief says FSA needs to ensure that TCF does not result in regulation via the back door

Lack of knowledge of the FSA’s Treating Customers Fairly initiative could cause advisers unnecessary expense, warns Aifa.

Sixty-three per cent of 393 members who responded to Aifa’s monthly IFA census claim that the regulator had not done enough to communicate the initiative to advisers.

Aifa is concerned that this lack of information might lead to regulation through the back door.

Thirty per cent of members say they are insufficiently clear on the long-term implications of TCF to be able to predict the financial impact.

Thirty-one per cent say TCF will increase their costs while 39 per cent do not expect that implementing TCF will make a difference to the costs of their businesses.

Eight per cent of respondents to the September survey say they are aware or very aware of TCF but 49 per cent say they have made no changes to their businesses as a result of the initiative.

Aifa director general Chris Cummings says although the FSA expects that TCF will be adopted and supported by leading firms, the survey highlights that this is the case for only half of firms.

Cummings says: “It is less than surprising that firms could not estimate the costs of TCF. The market is still uncertain about the real impact of the FSA’s move to principle-based regulation so caution is only natural. The FSA needs to ensure that TCF does not result in regulation via the back door.

“Firms need to be clear about what is expected of them, otherwise the introduction of this initiative could create regulatory and financial problems.”

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