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‘RDR won’t work without tiered advice’

The FSA’s proposal to separate advice and sales is “impossibly flimsy” and unlikely to see the light of day in its present form, claims Beachcroft Regulatory Consulting.

Managing director Richard Hobbs says a split between advice and sales is achievable but would require the triaging of different levels of advice.

He says: “During a fact-find, you might discover that an individual needs a different form of advice. If you do not have triaging, there is a huge incentive to sell the consumer what you can rather than refer them to a more appropriate service.

“If all services come under one roof, the owner will not mind what the consumer needs because they will be able to offer it and will still make money.”

Hobbs believes that in some cases, the service received from an adviser is comparable with a tied or multi-tied adviser.

He says: “There is no difference between a top tied adviser at St James’s Place and an IFA because it is the asset class and asset manager that makes the performance difference. The wrapper is of no importance.”

He warns that the retail distribution review interim report has created a constituency determined to fight back against proposals to exclude tied and multi-tied advisers from the advice sector.

Hobbs says: “Banks have far more resources than the IFA community and I expect they will fight back hard.”


Cracking the safe

The variable annuity market has seen a lot of activity in the last two years and at least two providers, Standard Life and Aegon, have plans to enter the fray this year.

ABI rejigs protection committees

The Association of British Insurers has restructured its protection committees to separate day-to-day work from long-term strategic thinking.

A bull case for US equities?

Neptune video: a bull case for US equities?

Watch Felix Wintle, head of US equities at Neptune, discuss why he believes US equities are in a structural bull market and the key factors that can drive the S&P 500 higher.

In the video, Wintle addresses the following:

• The US market and why — despite equities rising from 2009 — he believes the structural bull market only started in 2013
• Key economic and corporate factors that can drive the S&P 500 higher
• Investment themes and sectors offering exposure to the domestic recovery


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