Firing Line: Tim Gormley
For Tim Gormley, IFA of Loughborough-based TMG Financial Planning, the RDR is an inevitability that IFAs have not had much influence over, and is all part of an ongoing process of control from the regulator.
He said: “I think we’ve got no choice in the matter. If you want to continue to be a financial adviser then these [new] levels of qualifications are required now.
“It’s something that’s been imposed from above. It’s been told to us, the financial advisers have no say in the matter.”
He said it was all part of the distant nature of the FSA.
“It’s financed through IFAs and other organisations and it’s not accountable in many cases. It’s been allowed to develop itself without a great deal of input from outside.”
He said he has seen a gradual increase in control over financial advisers’ lives. “The sort of reports and things you have to do, the levels of monitoring and levels of compliance and the auditing of everthing that we do – it’s a massive change for the industry over time. Over the last 10 years or so there’s been a massive increase in the amount of costs and changes we’ve had to do.”
He is not entirely sure that it is all for the good. One of his biggest complaints is that blame-free advisers often have to pick up the tab for problems caused by other companies. He said that it might be the poor quality firms that are stopped or fined by the FSA – “but the cost is passed on to the rest of us.”
A lot of the problems that happened came about from products that many advisers would not have advised on. He said: “Keydata is a classic example, and pensions mis-selling – a lot of IFAs wouldn’t be involved in moving people into private schemes. With Keydata, the vast majority would never have looked at these products.
“It’s an unfair system, I think each of us has to be dealt with in terms of business risk.”
Mr Gormley has about 50 clients, and, based in Loughborough, he advises across the spectrum, dealing with mortgages, pensions, insurance and investments. He has been in the industry for 21 years, 11 of those as a financial adviser. He was in a group of financial advisers up until 2007, when he decided to strike out on his own, so that he could work from home.
“It’s been up and down, I’ve had some fairly good times, but there’s been a hell of a lot of changes with the credit crunch and various other things, such as mortgage market changes and with the introduction of the RDR.
“The impact on investments has meant there’s been a period where the values of clients’ investments have declined. I’d say some of them have been more risk averse, because of what’s been happening, a lot of people are holding back to a certain extent. They won’t do anything for a bit and they hold the money which in some instances can be a bit of a problem because the value of money is being eroded by inflation.”