The FSA is reluctant to allow those without equivalent qualifications to immediately assume the role of professional financial planner. It is considering ‘grandfathering’ an adviser into the new role for a limited period, allowing those without the necessary qualifications to undertake further training and testing.
IPFM director Luke Gibbon says: “I suspect this has been partly orchestrated by people with their own interests. Some people will want to put a handle on themselves to gain a competitive advantage. They will want to say I am better than the adviser down the road because I am professional.”
Professional financial planners would provide full advice to wealthy clients but they would not necessarily cover the whole of the market. They would be fee-based but the definition of fees could cover commission arrangements that are agreed by the client.
All professional financial planners could be regarded as independent under the FSA’s redefinition of the term to mean free from potential provider bias rather than whole of market.
Gibbon says: “I’m not saying some people don’t have a commission bias but for any decent IFA it’s not an issue. My clients have always been offered the choice of fees or commission. They don’t deal with me necessarily because I’m cheap, they trust me on the basis of past experience.”