View more on these topics

Tom Selby: MPs right to focus on vulnerable clients as quick fix eludes us

My dear Grandad passed away just over four years ago. During his life he was a pillar of the community in Kendal (home of Mint Cake) and Morecambe (home of Eric), owning two successful paint and wallpaper shops and speaking regularly at local Women’s Institute events.

He was comfortably off, a regular (if limited) squash player and generally in rude health.

And then, in 2007, Alzheimer’s struck. The decline was slow at first, regularly repeating stories and forgetting what he was talking about mid-sentence. But as the disease took hold, his cognitive ability became seriously impaired, forcing him to give up driving and ultimately surrender his independence.

By the end, he needed round the clock care, unable to walk or even get dressed without the help of a nurse.

Clive Waller: FCA vulnerable client focus will only complicate matters

I share this story with you not to garner sympathy – my Grandad had a wonderful life and I was lucky enough to live next door to him for 18 years – but to illustrate how a person can quickly and unexpectedly become vulnerable.

According to the Alzheimer’s Society, there are about 850,000 dementia sufferers in the UK today, with the number expected to rise to one million in 2025 and then two million by 2051.

It is perhaps these trends, driven in large part by the growth in the number of older people in society generally, that has prompted the Treasury committee to investigate the treatment of vulnerable people by the financial services industry.

The committee’s probe mainly focuses on the disappearance of banks from the high street, with major institutions increasingly shifting their businesses online. While such strategic moves are driven by market forces, the concern is that large chunks of society risk being cut off from accessing even basic financial services altogether.

Politicians are right to turn the spotlight on this important issue but there is a common misconception that vulnerability is just about older people or those suffering from diagnosed illnesses. The reality is every single person reading this article will, at some stage in their lives, be vulnerable.

Nick Bamford: Are you noticing vulnerability?

The death of a loved one, for example, can leave those left behind in an acutely vulnerable emotional state. I personally suffered from a short, unexpected and debilitating bout of anxiety shortly after my Grandad passed away.

Women often suffer significant mental issues in the wake of childbirth, with some falling into deep depression. Mental illness can equally strike out of nowhere and last for days, weeks, months or even years, with suffering often kept secret even from close family and friends.

Attention on this important topic is long overdue and all involved in delivering financial services, including advisers, have a huge role to play in ensuring vulnerable and potentially vulnerable clients are identified and protected as much as possible.

That said, the committee’s investigation will discover the complexity inherent in even identifying vulnerability, let alone delivering solutions to ensure those who are vulnerable (or risk become so) are properly catered for.

In short, there are no quick fixes – tackling vulnerability requires broad collaboration between firms, regulators, politicians, charities and consumers themselves.

Companies across financial services need to build understanding of vulnerability into their cultures, sharing best practice and continually reviewing and improving the processes put in place to protect consumers.

Tom Selby is senior analyst at AJ Bell

Recommended

8

‘Prevent and protect’: How the FSCS is trying to stop phoenixing

The Financial Services Compensation Scheme has said it is committed to stopping so-called “phoenix” firms dumping liabilities on the lifeboat fund through a strategy it is calling “prevention as well as protection”. Earlier this year, the FSCS conducted research as part of an internal policy paper on the issue of phoenxing, where financial advisers elect […]

Handcuffs Justice Guilty 480
2

Raids and arrests in suspected £18m pension fraud case

The Pensions Regulator has opened an investigation into a case of suspected pension fraud worth £18m. The regulator believes some 370 people have been scammed into moving their savings into eight supposedly illegitimate pension schemes. In a joint operation between TPR and Essex Police two residential addresses in Essex were searched last week. A business […]

FCA fines investment consultant over Vanguard conflict

An investment consultant has been banned and fined £20,000 by the FCA for failing to declare conflicts of interest. As a non-executive director at two mutual societies, Angela Burns was asked for guidance on investment management services, and participated in conversations about Vanguard, which had just opened UK offices. She simultaneously solicited work from Vanguard […]

Axis e-zine

Read our recently produced Axis e-zine. The e-zine introduces the RL Global Equity Select Fund, highlighting the fund’s distinctive investment process and including thoughts from financial advisers. Read the e-zine here Past performance is no guide to the future. The value of investments and the income from them is not guaranteed and may go down […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

There is one comment at the moment, we would love to hear your opinion too.

  1. Govt needs to tackle vulnerability in every area where individuals wield power, elderley care homes, orphanages, mental care homes, hospitals, police, retirement villages, media, sports clubs, leisure clubs, scouting, guiding etc etc. Power corrupts, absolute power corrupts absolutely.

    There are far too many hidden agendas in Govt and even recent events in the other house are typical of leaders and MPs unwillingness to call offenders to book.

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