Liberal Democrat MEP and Economic and Monetary Affairs committee chair Sharon Bowles is planning to launch an EU crackdown on “excessive” adviser charging.
Bowles says she is “unhappy” at banks’ post-RDR advice charging structures and wants to intervene with tougher disclosure rules for all advisers.
Speaking to Money Marketing, Bowles says she is looking to introduce rules that will force advice firms to show their charges as an hourly rate equivalent through Prips legislation currently moving through the European Parliament.
She says: “There could be more disclosure so, just like lenders have to show APR for interest rates, advisers show what it would mean for an hourly charge.
“There could be intervention when it is excessive as advisers have to prove they are earning their money.”
Bowles is also considering pushing for a ban on percentage fee charging through Mifid II in order to force advisers to charge a fixed fee or hourly rate.
Lansons Communications director Richard Hobbs says Bowles has significant influence in Brussels, but adds: “The rest of Europe is on a bancassurance model and does not have the same sensitivity to charges as we have. It does not follow that this UK-centric issue will carry very far when you involve all 27 states.”
Association of Professional Financial Advisers policy director Chris Hannant says: “I do not think it is appropriate at a European level to try and micro-manage fees. People will only agree to fees they are happy to pay and the sort of concerns she has are fanciful.”