View more on these topics

Pru says misselling fears hold back simplified advice


Prudential UK and Europe deputy chief executive Barry O’Dwyer says firms are not offering simplified advice services because of future misselling fears.

Speaking at the Lansons Communications Future of Financial Services conference yesterday, O’Dwyer said regulatory uncertainty is stopping progress.

O’Dwyer was responding to a question from the Citizens Advice Bureau which called for a low-cost advice service to fill the gap between advisers serving upmarket clients and the Money Advice Service providing basic information.

He said: “The problem is the word advice. If consumers have someone telling them what to do then it opens Pandora’s box in terms of future misselling. The problem is that most consumers require someone to tell them what to do and that constitutes advice.

“It is trying to design something that is short of advice and that does not tell consumers what to do but contains enough information to help.

“The difficulty the whole industry is facing is that they do not believe they will always be held to a consistent standard. Even if you designed something that was not advice a lot of the industry is concerned it could be construed as advice in 10 years’ time.”

In March 2012, the FSA published its final guidance on simplified advice when it said it must carry the same liabilities as full advice and meet the same adviser charging and qualification rules.


Transact picks Calastone for auto re-reg

<!– <!– <!– –> –> –> Transact has chosen fund transaction network Calastone to provide its automated re-registration service, a proposition which Calstone says moves the platform market closer to same day re-reg. The regulator requires platforms to offer re-reg, though it does not require that the process is automated. Not all platforms have automatic […]

Nationwide plans £500m bond to boost capital

Britain’s biggest building society Nationwide is looking to raise up to £500m in order to boost its capital. The Sunday Times reports the mutual could launch the fundraising as early as this summer, depending on market conditions. The newspaper says although Nationwide is well-capitalised under current measures, it is exposed to new rules from the […]

CML: Gross lending up 9% in March

Gross mortgage lending grew by 9 per cent between February and March, according to figures published today by the Council of Mortgage Lenders. In March, lenders advanced £11.6bn to borrowers, up from £10.6bn the month before, but the figure was 8 per cent lower than the £12.6bn advanced in March 2012. The CML says the […]

The fifteen-year itch

By Neil Jones Technical support manager with Canada Life’s ican Technical Services Team. Canada Life offers a range of wealth management solutions, including retirement income planning, estate planning and investment solutions from a choice of jurisdictions, including the UK, Isle of Man and Republic of Ireland. The treatment of non-UK domiciles that are resident in […]


News and expert analysis straight to your inbox

Sign up


There are 4 comments at the moment, we would love to hear your opinion too.

  1. This simplified advice/products thing has been rolling on for years now. we have already CAT standards, if you can still remember them.

    Once again the authorites have been hoist on their own petard by retrospectively blaming advisers for things they did years ago that were regarded as suitable at the time.

    A simplified product is a deposit account.

  2. What is simplified advice?

    This was a process dreamt up by Hector Sants as a potential gift to his banking colleagues and I’m glad to see that large providers like the Pru are running scared of it because of potential miss selling scandals.

    How can you give advice to an individual without taking into consideration the whole circumstances there is no such thing as simplified advice and they never should be.

    I really do hope that the regulator and our profession kick this bad idea into the long grass.

  3. ‘Simplified advice’…Is that what many financial journalists provide the public with?..You know, generic recommendations from unsuitably qualified, unregulated individuals in the main, who use quotes from certain regulated sources to justify their suggestions/articles!

    Because if so, Pru are correct. It should not have a place at all!

  4. I think that fear has become the dominant factor across most of the UK’s financial services industry ~ fear of hindsight reviews, fear of specious complaints instigated by CMC’s, fear of a regulator that shucks off onto others responsibility for its own failures, fear of being bled to death with regulatory levies, fear of drowning in the relentlessly increasing burden of compliance, fear of the press constantly accusing us of offering poor value, fear of clients thinking they can do for themselves what they’ve paid us to do for them in the past, fear of a government whose policies are destroying rather than building public confidence in long term saving.

    The picture may not be uniformly bleak, but there seems to be a lot more of which to be afraid (very afraid) than there is to be optimistic about.

Leave a comment


Why register with Money Marketing ?

Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

News & analysis delivered directly to your inbox
Register today to receive our range of news alerts including daily and weekly briefings

Money Marketing Events
Be the first to hear about our industry leading conferences, awards, roundtables and more.

Research and insight
Take part in and see the results of Money Marketing's flagship investigations into industry trends.

Have your say
Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

Register now

Having problems?

Contact us on +44 (0)20 7292 3712

Lines are open Monday to Friday 9:00am -5.00pm