The director of long-term savings and pensions at the regulator said it may issue public notices over two firms already referred for enforcement, after its review into inducements and conflicts of interest found over half of life companies were found to be violating the objectives of RDR.
Mr Poyntz-Wright said most companies were struggling to even identify a potential conflict of interest when they are making payments to advisers under service and distribution agreements.
He said: “The reason why we only referred two firms for enforcement action was because these were at the worst end of spectrum of practices we saw.
“We believe its better to have a dialogue with companies, many of whom are now responding and developing policies that are more in line with the direction we want to see.
“This is not about setting out exact criteria that should be met to comply with the rules right now. This is about a mindset and a culture. We decided to issue guidance to provide a degree of clarity but inevitably, we are not able to answer every question about what is and is not appropriate.”
Mr Poyntz-Wright added that trade associations, such as the Association of British Insurers and the Association of Professional Financial Advisers, were working with the regulator to “draw a line” under the “disappointing” findings of the review, contained in the GC13/518 page guidance consultation published today (18 September).