View more on these topics

Traffic light system could help rate risk

Retail Financial Services Group chairman Richard Lambert has called for a traffic light system for financial products.

Former monetary policy committee member Lambert told the Building Societies’ Association annual conference in Manchester last week that pressure must be put on the FSA to introduce a simple consumer risk warning system in conjunction with industry to regain consumer trust.

Lambert, who steps down from his role as RFSG chairman in preparation for his new role as CBI director general in July, said the FSA would “run a mile” from such a suggestion but a traffic light system that clarified risk would be a welcome way forward.

The RFSG was set up last year to bring together industry and consumer interests and inc-ludes representatives from Aviva, Prudential, Sesame and Which? The aim of the group is to regain consumer trust and head off potential misselling problems, with much of its recent work focusing on equity release.

Lambert said the RFSG’s work had been justified by the evidence from FSA equity-release mystery shopping exercises which he described as “stunningly depressing”.

Former Financial Times editor Lambert also warned consumer groups that the inconsistency of their current work was hindering consumer confidence and they must be willing to put forward their own solutions and give examples of good practice the credit they deserve rather than simply bashing the industry.

Lambert said: “I do not think it is fair or reasonable to ask the FSA to assess all risk. A market solution for this challenge is a risk ratings and traffic light system. The FSA would run a mile but it would be in the client’s and consumer’s interests to come up with a clear expression of risk.”

Recommended

‘Six million workers set to lose out under NPSS’

Six million company pension scheme members face a cut in their benefits under the proposed national pension savings scheme. Research from Axa has found that 34 per cent of employers which contribute 3 per cent or more to a company scheme will consider reducing contributions to 3 per cent if the NPSS is introduced. Forty-nine […]

Gartmore MBO announcement imminent

Gartmore is likely to announce the terms of the private equity-backed management buy out of the investment house “either later today or early tomorrow morning” according to a company spokesman.US group Hellman & Friedman are currently finalising the legal details of the agreement which will be expected to lock in a number of the company’s […]

Anniversary waltz

Measuring the extent of the Chancellor’s attack on trusts in this year’s Budget

Benefits of using a probate bare trust

Have you ever wondered what happens to someone’s investment bond on their death if it is not written in trust? When someone dies it is essential to deal with their estate, which can be made up of their home, belongings, investment bonds and anything else they may have owned. But, it is not as simple […]

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