Financial Conduct Authority  

FCA suitability review faces indefinite delay

FCA suitability review faces indefinite delay

The regulator's second suitability review of retirement advice faces an indefinite delay as a result of the coronavirus crisis after it was initially pushed to next year. 

In May the Financial Conduct Authority confirmed its upcoming review of the advice consumers receive around retirement income had been delayed as the watchdog shed "non-critical" in the face of the pandemic. 

The review was tentatively set to pick up again between January and March next year, with the FCA stating the process could continue into the second quarter of 2021. 

But in an update published today (September 18) the second suitability review has dropped off the FCA's regulatory timetable entirely. 

The watchdog's website now shows the review to be on indefinite hold, with a date at which it will be revisited yet to be decided.   

The FCA began quizzing advisers on their retirement income advice records at the beginning of this year, sending information requests to 125 randomly selected advice firms. 

The letters form part of the regulator's fresh crackdown on the advice market and it is understood the regulator will look at the root causes of poor advice throughout the suitability review. 

The City watchdog first moved to delay certain areas of its regulatory timeline in March in an attempt to allow firms under its supervision to focus on "supporting their customers" during the pandemic. 

But speaking at FTAdviser's Financial Advice Forum this week Alex Roy, head of consumer distribution policy at the FCA, said the regulator was likely to delay more work as the industry battled an ongoing coronavirus workload. 

Mr Roy said it was "inevitable" more important pieces of work would be stopped at the FCA while the regulator could "no longer see them as important in the current crisis".

An FCA spokesman said: "We continue to review our work plans to delay or postpone activity that is not critical to protecting consumers and market integrity in the short term. Some workstreams are being stopped to enable us to focus on critical work.

"Delaying or postponing certain activities also allows firms to focus on supporting their customers during this period." 

rachel.mortimer@ft.com 

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