View more on these topics

Regulator will look for advice biases after RDR

The FSA says it will be on the lookout for advice biases that will remain or be created following the retail distribution review.

The regulator’s retail conduct risk outlook, published this week, raises concerns about continued provider influence, sales biases and services recommended purely to justify ongoing fees.

It is worried some providers may look to circumvent the commission ban by offering advisers other incentives, such as business or consultancy services, despite inducement rules put in place to prevent this happening.

It points out that a potential sales bias could persist despite the new adviser charging rules.

The FSA adds that the requirement for advisers to provide an ongoing service to justify ongoing fees may incentivise firms to make more transactions than necessary.

Pilot Financial Planning director Ian Thomas says: “There is still a sales model used by some that will continue to see payments by product providers in one way or another. It is one of the problems which I do not think is solved by the RDR.”

Royal London group head of communications Alasdair Buchanan says: “I think the regulator will be eager to make an example of some firms.”

Zurich intermediary sales director Richard Howells says: “The difficulty for the regulator is that there are providers offering training and support to advisers which are there to improve the level of professionalism in the industry.

“Distinguishing between that and other forms of inducement other than commission could be hard.”

Recommended

Skandia drops JP Morgan from global equity mandate

Skandia Investment Group has handed over management of the £222m Skandia global equity fund mandate to Five Oceans Asset Management. Long-only manager Five Oceans uses various sectors and styles for diversification while aiming to significantly outperform the MSCI World Index over a rolling three to five year period. It takes a high conviction approach, focusing […]

Life office profit push could hit TCF

The FSA says life offices are under pressure to drive up profits and run the risk of creating consumer detriment by pursuing aggressive growth strategies. The FSA’s retail conduct risk outlook, published this week, says the continued net outflow of assets from life companies suggests firms will need to make significant changes to their business […]

1

Newbuild Mig gets flying start with 95% loans

Brokers predict the Government’s indemnity guarantee scheme will be a success after Barclays, Nationwide and Nat-West launched cheap 95 per cent loan-to-value products for newbuild homes. The NewBuy scheme, which launched this week, will allow buyers with a 5 per cent deposit to purchase a newbuild property worth up to £500,000. Housebuilders will deposit 3.5 […]

Five ways to invest in the connected world

Smart utility metering; fitness trackers; connected cars; smart factories; precision agriculture: the internet of things encompasses myriad applications. But how do you gain exposure – and profit – from this growing trend, asks Neptune fund manager & CTO Ali Unwin. Read more: Important information Investment risks Neptune funds may have a high historic volatility rating […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    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

    Email: customerservices@moneymarketing.com