In relation to the suggestion by the FSCS chief executive, Mark Neale, that payment of the FSCS levy should be made on a risk-weighted basis, I have the following suggestions.
1. Link the levy to a risk rating of permissions companies hold. This should not be difficult. Those recommending that these products pay higher fees for the increased risk.
2. Have a product levy for those deemed to be higher-risk products – it should not be difficult to come to a view on what is higher risk. Those taking out these products should pay a fee to be covered in the event of mis-selling/other failure.
3. Fines raised should go into a central pot to ensure that the many do not pay for the few. By their actions, the FCA should be focused on those who pose the highest risk. It is only the FCA which can prevent the issues we have seen, not low-risk client-centric financial planners and advisers.
Chartered financial planner,
Otus Financial Planning,