The past year has been a “vital one” for the Financial Conduct Authority and its relationship with advisers, the regulator’s chief executive has said.
Speaking to FTAdviser, Martin Wheatley described the last year as an “important period” for developing its relationship with firms and the advisory sector generally, which he said was led by the 106 events it has held for firms around the country over this year.
Mr Wheatley also flagged up that in the last 12 months the RDR, now coming to the end of its second year, has bedded in with a “good response by firms, most significantly in achieving the higher quality standards”.
His comments come in the wake of the two-year post-implementation review of the rules published last week, which generally gave a strongly positive view of the changes in the sector, including the removal of product bias and professionalism.
The review did state there were areas for improvement including around the new ‘independent’ and ‘restricted’ definitions brought in under the new rules, which may now be scrapped.
Mr Wheatley added that the FCA plans to build on the work done this year in 2015, which he said means more events, and more guidance and support where it’s needed.
“It is our aim to have an open door to those we regulate”, Mr Wheatley said. “That is why the next 12 months will be important for Project Innovate as we provide support to firms with new ideas they want to bring to market.”
The new pension flexibilities are set to be implemented from April and the FCA said it will keep its focus on this “absolutely vital” market for consumers.
Mr Wheatley said: “This includes a review of our requirements around pensions and retirement, which will take into account the results of our thematic review of annuity sales practices and interim proposals of the retirement income market study.
“Additionally, we’ll be publishing the supervisory work into due diligence at advisory firms.”
Earlier this month, the FCA published its retirement income study and also its annuity review. The latter found that while there was not widespread mis-selling of annuities, enhanced annuities remain a cause for concern and several firms have been told to review client files.
Mr Wheatley added that “above all else”, the regulator will continue to look at culture within the financial services industry.
“We want to make sure that the needs of consumers are considered first by all the firms in our industry.
“We are under no illusions about the scale of that task, but our hope is that the post-RDR advisory sector can be example for others – professional, expert, trusted by consumers, and underpinned by advice in the best interests of investors.”
donia.o’loughlin@ft.com
