What is advice? That is the question. As the nights start to draw in HM Treasury has given advisers (and journalists) something to think about on those cold winter evenings.
Its consultation is just one of the big issues to have hit the headlines over the past week.
1) The definition of advice
On Tuesday the Treasury published its plans to change the definition of advice – which apparently it can do without consulting the word-boffins at the Oxford England Dictionary.
The main thrust of the change is that the British definition of advice would be brought in line with the European one, introduced in the original Mifid, making it clear that only advice which gives a personal recommendation would be regulated.
The announcement has received a mixed reception with some, such as Chris Hannant, saying this has “solved a problem which doesn’t exist”.
But Fiona Tait of Royal London appeared more open-minded, saying consumers could understand and relate to the idea of a personal recommendation.
2) LV’s profit problem
Poor performance in LV’s general insurance division saw the company’s pre-tax profits plummet in the first six months of 2016, despite strong sales in its life arm.
Pre-tax profits fell from £49m to £1m – a whopping fall of 97 per cent.
But LV’s life and pensions arm saw sales breach the £1bn mark in the six months to June.
Chief executive Richard Rowney said attributed the drop to lower profits in the general insurance division and a £19m loss in the group’s heritage business driven by “claims experience variances”.
3) Fos complaints in limbo as advice firm stops trading
According to the Financial Ombudsman Service 13 complaints have been passed on to the Financial Services Complaints Commission after Assured Review IFA ceased trading.
One complaint lodged against the firm by adviser Kim Barrett was upheld by an adjudicator who had “very serious concerns” about the suitability of the advice the client received.
Assured Review IFA had recommended that the client transfer £70,000 of his pension savings into a self-invested personal pension.
4) Banging on about Brexit
This week saw the emergence of some actual facts on Brexit, in lieu of any from politicians.
This week the Financial Conduct Authority revealed that 5,400 firms use passports to do business in Europe.
This, the chairman of the Treasury Select Committee said, could leave them at “significant” risk as the UK negotiates to leave the European Union.
Meanwhile analysis by the Institute for Public Policy Research found that financial firms pressed pause on hiring staff over the summer as they tried to figure out what on earth Brexit would mean.
Investment Association statistics also showed that there were significant net retail outflows of £1.5bn from the property sector after the referendum.
5) Standard Life and Almary Green opt for conscious uncoupling
FTAdviser is sad to report that, along with Brad and Angelina, Standard Life and Almary Green have gone their separate ways.
After announcing plans to buy Almary Green earlier this year, Standard Life announced that the two firms “mutually agreed” not to go ahead with the deal – though they didn’t explain why.
Almary Green’s managing director Carl Lamb has said he is open to future deals.
Meanwhile Standard Life’s advice arm Pearson Jones – now trading as 1825 – which Almary Green would have joined posted profits down by 65 per cent for 2015.
It was unclear at the time of going to press what Jennifer Aniston thought about all this.
