Damian Fantato  

Addressing a lack of trust

Damian Fantato

Damian Fantato

Journalists and financial advisers have several things in common – one is the concern that robots are coming for their jobs.

But the most important one is that they suffer from a general lack of trust among the population at large, which is damaging to wider society in different ways.

If the public does not trust journalists, then it leaves a vacuum that is filled by ‘fake news’.

For financial advisers, the concern is that savers come to the conclusion that they cannot trust anyone and start making their own decisions about what to do with their money.

Ultimately this ends with a lot of people invested in an illiquid open-ended fund, which they can’t get their money out of because it has been suspended.

Arguably, advisers can blame others for their problems – the 2008 crisis made sure there was a general lack of trust among those who worked in the financial services sectors – but as a community it still suffers from pockets of poor practice that hamper its reputation.

It is true there is a limit to what individual advisers can do to address this – apart, perhaps, from cleaning up the mess afterwards, as has happened so commendably with the advisers who offered their time and knowledge to help those steelworkers who transferred out of the British Steel Pension Scheme.

It has since emerged that some of the steelworkers were told to transfer out of their defined benefit scheme after a session lasting as little as two hours. Some had received a recommendation to transfer before 45 minutes had passed.

Clearly the advice these steelworkers received was not up to scratch, and it is not as though high-quality advice is unavailable: an increasing number of advisers are aspiring towards chartered, and many offer their services pro bono.

The biggest problem is a lack of knowledge among the general population about what to expect from their adviser and which kitemarks they should look for.

This is something only the advice profession as a whole can fix on its own.