The Association of Professional Financial Advisers has written to Martin Wheatley, chief executive of the FCA, outlining four changes they want to see the regulator take as part of a regulatory ‘dividend’ to reduce the burden on advisers.
The trade body’s renewed calls come after a recent Treasury select committee meeting, where Mr Wheatley admitted concern about the availability of advice to consumers post-RDR, and acknowledged the issue of mainstream client advice access needed addressing.
The four demands made by the trade association are for the FCA to:
1) streamline the data it collects from advisers and increase the time for reporting from six weeks to three months;
2) ensure their regulatory approach to Consumer Credit Act regulation when it takes over this in April 2014 reflects the different types of risk different firms present, rather than a ‘one size fits all’ strategy;
3) make good on a commitment its predecessor, the Financial Services Authority, gave to parliament that it would consider whether to investigate the case for a long-stop as part of its business planning for 2014 to 2015; and
4) increase the Financial Services Compensation Scheme threshold in light of the fall in adviser numbers.
The trade body argued that following the RDR, the reduced risks to consumers means that less regulatory resource is needed to supervise advice firms and this should be reflected in the costs the FCA allocates to advisers in order to reduce their share of the bill.
Chris Hannant, director general of Apfa, said: “The aim of the RDR was to improve the delivery of investment advice for consumers. Higher professional standards now, and the elimination of commission bias, will reduce the risks that consumers face.
“For a risk based regulator like the FCA, reduced risk should entail reduced supervisory effort. In turn, this should mean lower costs - which we want to see passed on to advisers.
“There are a number of steps we think the FCA can take to reduce the regulatory burden on advisers, both directly, in terms of fees, and indirectly, in terms of supervision and compliance.
“We have set these out very clearly to the regulator, and we will be producing a regular flow of evidence so we can hold them to account on each one.”
