In Depth: Is FSA guidance good news at last?
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In focus: Future of Independence
Could it be? Do your senses deceive you? Surely this couldn’t be a piece of good news from the Financial Services Authority?
Last week (7 June) the FSA published finalised guidance on what it takes to be labelled an independent or restricted adviser after the Retail Distribution Review requirements come into force.
Generally, the concensus seems to be the guidance is clear, reasonable and even encouraging.
Where commentators previously predicted a huge shift away from independent advice, this latest guidance seems to have mitigated that outlook and made clear that advisers, if they so wish, will very much be able to remain independent.
Ken Davy, chairman of adviser services supplier SimplyBiz, was among those pleased with the clarifications therein.
He said: “I think the confirmation that IFAs can remain independent and you don’t have to consider Ucis if you don’t believe they are suitable for the clients is a real breathrough and it is very good to have that confirmed.
“On all the information that is now formally available it is unlikely that anyone who is currently operating as an IFA will be forced to change their stance if they have the appropriate support.”
He adds this news is “very positive for the IFA sector”, and is actually much simpler than it could have been.
“We did fear the FSA was losing the plot when they talked about having to consider Ucis for clients. At one stage it was even rumoured that IFAs would need to have knowledge of products across the world.
“Anyone currently operating as an IFA has no need to feel forced to change their position. There is nothing in these rules that a half-decent IFA won’t be able to comply with providing that they have some support to get the information they need.”
In SimplyBiz’s latest adviser survey, they found 93 per cent of respondents said they were determined to remain independent.
SimplyBiz serves more than 2,100 directly-regulated firms with a sum total exceeding 5,000 advisers.
Mr Davy said: “Now overwhelmingly we know that their preferenc is to remain independent. The additional research and support we will be providing we will not be ch
There is nothing in these rules that a half-decent IFA won’t be able to comply with providing that they have some support to get the information they need.
One voice of dissent comes from Andrew Fisher, chief executive of Towry Law. He believes there is still significant clarification needed as to what specifically constitutes a restricted versus independent adviser.
He said: “I don’t think it’s still sufficiently clear for advisers. I suspect that there will be more guidance coming out.