OpinionSep 8 2016

What would happen if the FCA had to pay for scams?

twitter-iconfacebook-iconlinkedin-iconmail-iconprint-icon
Search supported by
comment-speech

With regard to the story about the financial adviser who helped a client after he lost 90 per cent of his pension pot (FA, 1 September), the sad fact is, this will go and on.

The Financial Conduct Authority (FCA) does not have to do anything about these as long as the current Financial Service Compensation Scheme levies are calculated the way the are – that is, the many pay for the few. If the FCA had to pay, it would be so so different; if they made these types of transactions require a specialist permission or demand a levy on these type of investments, and the self-invested personal pension providers more accountable, at least it would go a long way towards reducing the amount of pension scams.

Most IFAs would not even consider these types of investments for their clients, and I still cannot understand these companies that sell these high-risk investments, take all the large commissions, wind up the company and start again via the FCA process.

I was trying to explain to a friend (who is a solicitor) about the concept of the levy, and he thought I was joking. Sadly not – even the fines do not go towards reducing the levy for the majority of IFAs, and we will be talking about this on forums for the next 10 years.

Steven Cusack

IFA

OnTrack Financial Planning

Falkirk