Financial advisers need to ask the Financial Conduct Authority what they need to do to prevent retrospective regulation coming back to bite them in years to come as an indirect result of the pension reforms, pensions minister Steve Webb said.
Speaking today (24 February) at the FTAdviser Retirement Freedoms Forum in London, he responded to a question from the floor on what advisers need to ask the FCA to prevent the risk of being hit with regulatory hindsight.
David Geale, director of policy at the FCA, is speaking at FTAdviser’s conference later today (24 February) and Mr Webb said to direct this question at him.
“In terms of people who get the wrong outcome, make the wrong choices, and look back and wants someone to blame, the first thing I would do is when you’ve got David Geale later today simply ask him your question: ‘What do I have to do in X months or years time when someone comes back and says ‘it all went horribly wrong I want someone to blame’ they don’t blame you?’
“Now what we are trying to do is make clear what the expectations are… treating customers fairly, the ‘second line of defence’ all those kind of things to make sure that you do everything that can reasonably be expected of you.”
He added there is “always a risk of regulatory hindsight”.
“We now have a set of views about how the world should work… we didn’t have one then but we are going to impose our view of the world now on the world then and say you should have done then what we know now and that would be wrong.
“So I would with a tape recorder ask the FCA what do I have to do so if someone makes the wrong choice no one is going to come back and blame you.”
Elsewhere, Mr Webb stressed that he wanted the public to use the web-based aspect of guidance most heavily in comparison with the other elements on offer: face to face and telephone.
“First of all there are three channels: the web based version, the phone based and the face to face, and that is the kind of hierarchy that actually for us the basic guidance if you are happy to go to a website follow a journey on a website, you’ll get everything you need in terms of guidance.
He accepted that those who have spent their lives doing face to face advice will be sceptical that the website is going to do that, but added: “That’s not what its doing is giving you a guidance journey is taking you through the content of what would happen if you phoned up or had a face to face session with Pension Wise, so as many people as possible we are keen for obvious reasons to use the website.”