As I write I have just been through the same painful process many of you will have had of logging on to the Financial Conduct Authority’s system to pay my latest demand for the additional Financial Services Compensation Scheme levy.
In pounds terms, mine was relatively modest by comparison with some I have seen posted online.
It is a percentage of turnover, so bills will be relative to the size of the company, but still a nasty pill to swallow.
The Krays had nothing on the FSCSAt 30 days’ notice, too, or you get an additional fine and the threat of having your permissions suspended or removed.
I would say it is a protection racket, but I am not sure I am getting much protection out of it.
The Krays had nothing on these guys.
We are being asked to stump up to cover the bad advisers, those that have ripped their clients off, put the money into dodgy investments or scams and used unregulated introducers.
Actually, I do not have a problem with that – we are far from the only area of life where that happens.
What does bother me, though, is the sheer amount that has happened and continues to happen, despite all the compliance and regulation we face.
The FCA just needs to actually apply the regulation it already has and it needs to use existing technology and information to better identify problem cases and deal with them sooner.
It might also help if those that do transgress were caught more often and brought to court, fined and actually made to pay the fines, or sent to jail.
They should certainly never be allowed in front of a client again in any shape or capacity.
If you sit as an employed adviser or within a network, don’t think you are exempt from this either.
Your company will have paid that bill as well and they will take that money back from you, and your clients, with higher fees to your authorised representative business or lower fee share.
A few, including myself, have written to their MPs and more of us need to do that.
It needs to be thousands of us, not just a handful. You can write your own or there are a few templates floating around online. Go on, do it.
Darren Cooke is a chartered financial planner at Red Circle Financial Planning
