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SimplyBiz claims regulator has big-firm bias

SimplyBiz has accused the FSA of being biased towards bigger adviser firms after what it calls the regulator’s lenient approach to recent capital adequacy problems at Millfield and Berkeley Independent Advisers.

It has written to the regulator asking why bigger firms enjoy preferential terms on minimum turnover. Compliance services manager Tim Grey says this is a worrying precedent that could serio- usly undermine the FSA.

He says: “I question the validity of the regulator’s threshold conditions when hundreds of small IFAs end- ure significant personal inconvenience to meet the capital adequacy requirements at all times, yet the industry’s bigg- est organisations continue to trade unabated and inadequate. Furthermore, I question an enforcement system that judges its penalty on the ability of the culprit to endure it.”

But the regulator is defending its position, claiming that all firms are treated equally.

FSA spokeswoman Samantha Bennett says: “We require all firms to have adequate resources, meeting the minimum capital requirements, regardless of size of company.”

Croydon IFA Formula director Mark Osland says: “I would be very disappointed if the regulator was changing the rules for bigger firms. Sadly, these companies, while lacking in profitability, have substantial backing from insurance companies.”

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