This week HM Revenue & Customs has been busy tightening the screws on wealthy taxpayers, regulators have been fining and providers were accused of poaching clients.
As snow sweeps across the British Isles, here is what you need to know about the headlines that dominated FTAdviser in the last seven days.
1) Financial Ombudsman Service under the spotlight
The Financial Ombudsman Service was in the news several times this week.
Firstly the Fos found itself on the brink of a legal challenge from hundreds of investors it has provisionally ruled are not entitled to seek compensation under its processes.
The dispute concerns a failed investment of £7.5m made by 973 investors in secured private corporate debt, known as ‘mini-bonds’.
The ombudsman was also criticised for the use of its time limits to prevent some complaints from going ahead.
Last but not least, the chief ombudsman dropped by to tell FTAdviser about the work her organisation does and that it upholds 40 per cent of cases against advisers.
2) Get off my land!
If we’re to believe Roald Dahl, pheasant poachers capture their pray with raisins laced with sleeping pills.
Unfortunately, Prudential has been accused of using slightly more prosaic methods to lure clients from advisers.
Scott Gallacher, director of Leicester-based Rowley Turton, claimed Prudential had deliberately cut his firm out of the communication sent to their client.
A letter to an adviser's client stated financial advice is one route of support and pointed to a restricted advice offering from Prudential.
For its part Prudential said it has strict rules in place to protect the relationship between client and adviser.
3) Professional indemnity insurance problems
If the Financial Conduct Authority thought advisers would be grateful for its work to lower the Financial Service Compensation Scheme levy, then it was disabused of that notion this week.
It found itself being criticised for its proposals for professional indemnity insurance, which some claimed could lead to providers leaving the market.
The FCA is considering introducing mandatory terms for professional indemnity insurance in the financial advice sector, such as requirements to have run-off cover and restricted use of limitations.
One professional indemnity insurer insider pointed out there are currently only 10 active underwriters in the financial advice market compared with around 75 in other similar sectors, such as solicitors and architects.
4) New Year’s resolution: pay more tax
Festive cheer has long disappeared as wealthier taxpayers look likely to be the subject of increasing scrutiny by HMRC, an accountancy firm has warned.
Gary Heynes, head of private client at RSM, said the taxman is increasingly looking at the wealthy in the belief more tax can be collected by carefully scrutinising their affairs.
He said HMRC is now targeting 100 criminal prosecutions a year, rather than two a year as they had done previously.
5) Life a virgin, fined for the very first time
The Pensions Regulator popped its cherry this week by fining two trustees of master trust schemes a total of £5,020 for failing to complete a chair’s statement.
It marked the first time the regulator has used its powers in this way following the introduction of strict new rules last year.
The regulator ordered the trustee of Nurture Master Trust, MC Trustees Ltd, to pay £2,000 for failing to prepare a chair’s statement for the scheme.
In a separate action, the regulator fined the trustees of the Save and Prosper Funds a total of £3,020, after they failed to prepare a chair’s statement for three master trust schemes.
damian.fantato@ft.com
