Regulation change and Fos claims: the week in news

Regulation change and Fos claims: the week in news

Supporters of the Prime Minister and lovers of day-time television shared a common theme this week as both Theresa May and Jeremy Kyle were told their time was up.

In the finance world, complaints against advisers dominated headlines as historic claims increased and claims management companies are targeting British Steel workers. It’s time for the week in news.

1 Regulation's the name of the game

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The FCA has confirmed it is open to changing its regulation if the results of its advice market review showed current rules are hampering innovation or failing to deliver the best consumer outcomes.

Speaking with FTAdviser Nisha Arora, director of consumer and retail policy at the FCA, said the City-watchdog was open to looking at whether its regulation needed to be changed if found it was "skewing" the advice market.

When asked if the FCA had seen any evidence in the market to spark concern, Ms Arora said the regulator was not approaching the review with any "preconceptions", but the concerns echo those seen in the FCA's Mortgages Market Study published in March.

There the FCA found some consumers were being "unnecessarily" channeled into advice.

Meanwhile FCA chief Andrew Bailey has broadcast his first podcast. He used the opportunity to say he very much wanted advisers to make a profit, contrary to popular belief (and, some say, regulatory policy).

2 The past can come back to bite you

The number of complaints against advisers submitted to the Fos have increased by 14 per cent last year, with historic claims seeing a rise of 13 per cent, latest data from the ombudsman has shown.

The number of historic complaints against advisers, where the event being complained about happened more than 15 years ago, jumped from 271 claims to 307.

Self-invested personal pensions (Sipps) topped the list of the most complained about products against IFAs, with the ombudsman resolving 232 complaints with an uphold rate of 62 per cent.

Caroline Wayman, chief ombudsman and chief executive of the Financial Ombudsman Service, called on advisers to ensure consumers were making the right pension choices.

3 Robo is a no go

Investec this week decided to close its Click and Invest robo-advice business following two years of losses.

In the company’s annual results, the firm said Click and Invest lost £12.8m in the year to the end of March 2019, having lost £13.5m in the year to the end of March 2018.

The company stated a lack of appetite for the service and slow market growth as being the reason for the move. 

Clients will be offered to sell their investments or transfer them to another provider without charge and the management fee has also been suspended throughout this transition period.

4 Targets of steel

Advisers who helped steelworkers transfer out of the British Steel Pension Scheme are now being targeted by claims management companies. 

Damian McPhun, partner at Beale and Company Solicitors, told FTAdviser he had several adviser clients who have had a complaint against them taken to the Fos with the help of CMCs.