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Virgin hits out at FSA&#39s penalising of Cat standards

Virgin Direct is attacking the FSA&#39s regulations for individual savings accounts for unfairly penalising Cat-marked ISAs with a risk warning that non-Cat products don&#39t carry.


Virgin believes that the FSA is driving customers into the arms of exactly the high charging managers that the Government wanted to exclude with Cat standards.


But the move is a clear victory for those who advocate taking financial advice.


The FSA regulations, produced in close co-operation with the Treasury, say that the key feature documents and direct offer advertisements will carry risk warnings stating that the Cat standard is not a performance guarantee and if consumers are in doubt they should seek advice.


Virgin has been one of the keenest supporters of the Government&#39s Cat initiative to date but it has serious concerns about the latest regulations.


Virgin Direct research & development manager Martin Campbell says: &#34We have always stated that Cat products should carry a risk warning but we will be unfairly penalised because non-Cat products don&#39t have to. The FSA is encouraging consumers to look at exactly the products they are trying to get them to avoid.&#34

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