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Wide-angle review needs to focus on the real picture

The day-to-day business practices of almost every IFA in the UK are being challenged by the Treasury-sponsored Sandler review.

In his “consultation” document, the former Lloyd&#39s of London chief Ron Sandler has questioned just about everything advisers do.

The two “observations” – IFAs might argue they are accusations – of most concern are IFAs&#39 lack of investment knowledge and that commission may be skewing the market to the detriment of consumers.

The paper also asks whether both commission and fees should be capped.

There is also unwritten implication that regulation is skewed in IFAs&#39 favour.

The review&#39s potential should not be underestimated. The final draft went straight to the top of the Government for approval. Chancellor Gordon Brown, when he turns his eyes on the IFA industry, however fleetingly, may not like what he sees or what he thinks he sees.

The real worry is the consultation is so widely drawn that it could be used as an excuse for almost anything. Many of the questions asked are so open to debate as to be almost impossible to answer.

The review will still run into the barrier that the public will not pay fees for advice and at least Sandler acknowledges this.

IFAs must respond to many of these accusations, however unfair they feel the terms of reference to be.

Of course, the report could could be kicked into the long grass just like Don Cruickshank&#39s review of banking. On the other hand for IFAs, it might just turn out to be the review to end all reviews.


London&#39s West End calls for WELPUT

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Advisers sign up to sell online benefits package

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Scottish Life sales up 22 per cent

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Aberdeen rocks split-cap sector

The decision to suspend dividends on Aberdeen&#39s European technology & income trust could send the split-capital investment sector into turmoil. The trust stopped dividend payments on its income shares last week after assets fell to £178m from £400m at its launch in March last year. After subtracting the trust&#39s £164m of bank borrowings, the fund […]

Is volatility dead? No, sell credit

There are several arguments that one could currently make for why credit markets look unattractive. These include signals that the US economy is in late cycle, the fact that corporate leverage has been increasing (with 2016 setting a record for the amount of global bond issuance), and that US high-yield default rates have risen considerably […]


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