IFA Centre highlights 'apathy' over reporting poor practice

Independent advisory trade body IFA Centre has warned that there is "a degree of apathy" over reporting examples of poor practice to the regulator due to a perception that the regulator has no "effective mechanisms" in place.

Gillian Cardy, managing director of IFA Centre, said that one of the earliest priorities agreed by members of the body, which was set up last year, was to find ways of ensuring that good firms and advisers do not suffer as the result of the activities of poor quality firms.

She added that practitioners are “extremely well placed” to spot poor practices and products whilst regulators are focused “more than ever” on early interventions to avoid consumer detriment.

However, she said members warned there is not an effective mechanism in place for concerns to be aired and that nothing was done when concerns were raised, leading to a "high degree of apathy towards reporting poor practice".

Ms Cardy met with the FSA yesterday (25 July) to discuss concerns she had on whistleblowing and said that she found the regulator's update the FSA’s approach "extremely useful" and that she had subsequently concluded that many of the members' concerns were "largely unfounded".

She said the experiences suggests there is a "gap between the reality of the FSA’s approach to market intelligence and the market’s perception of that approach", adding that IFA Centre would seek to address this with support materials on its website.

Ms Cardy said: “IFA Centre will therefore prepare a summary of the FSA’s systems and processes in this area. This should provide practitioners with clear information about how to make concerns known to the FSA and about what to expect from the process.”