Warning advisers 'missing the mark' on vulnerable clients

Warning advisers 'missing the mark' on vulnerable clients

Support services provider Paradigm Consulting has urged advisers to fall in line with the regulator's expectations on vulnerable clients, warning some firms were still "missing the mark" on what's required of them. 

In July the Financial Conduct Authority promised to take action against firms that do not treat vulnerable customers fairly as it launched its guidance on the issue, a move long-awaited by the industry. 

David Ryder, head of proposition at Paradigm Consulting, said while many firms were already correctly identifying vulnerable customers, there were still those that were "unfortunately missing the mark".

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Mr Ryder said: "With the FCA’s recent publication on the fair treatment of vulnerable customers, now is the perfect time for firms to consider how they approach advice in relation to vulnerable customers.

"Firms need to ensure that their culture, ethos and current practices all meet current FCA expectations and set a firm foundation for ongoing evolution."

The FCA has previously identified up to 50 per cent of consumers could be potentially vulnerable and require extra support, confirming in its July consultation that the industry had already sought greater clarity from the regulator on the subject.   

Mr Ryder said: "The traditional thinking on vulnerability needs to change, and it’s important that as an industry, we think outside of the box when it comes to this issue.

"Advisers should acknowledge that vulnerability, whether actual or potential, can affect anyone, regardless of wealth or age.

"It is no longer just the old or infirm who could be vulnerable, but it is a whole scope of people, from first-time homebuyers to ex-armed forces moving into civilian life."

Paradigm Consulting offers free online guidance for advisers in partnership with Just Group, which is designed to help intermediaries recognise vulnerable clients and implement appropriate policies in their firms.

Stephen Lowe, group communications director at Just Group, said: "Given the FCA’s increasing scrutiny in this area, firms need to give their vulnerability policy the utmost care and attention from the highest level.

"The launch of this new eBook is a comprehensive and powerful addition to the resources available to firms to help them understand and address their obligations." 

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