Advisers hit out at FSA over unresolved rules

FSA rules

Interested to know why the only issue for some IFA's is the 'Cash rebate' decision, as if that is automatically the correct post RDR way of dealing with a client. Cash rebates are just another form of commission, so like fund manager rebates they have to be banned as well. If we as IFA's want clear transparency then no rebates of any sort should be allowed, for all platforms, WRAP's and fund supermarkets including execution only. Although I am pro RDR, I agree with the commentator who said that it is impossible to plan a business's future without knowing exactly what you're planning for. I've given up trying to write a full Post RDR business plan for my business, as it is costly, time consuming, and very likely to change.

Posted by: Phil

Impossible

Writing a post RDR business plan is like a mother frog trying to give jumping lessons to its baby tadpoles. The only predicatable thing is that when commission is banned, IFAs will disappear. How can you write a business plan when you know that business is no longer possible?

Posted by: Ken Durkin

Ban everything

Transparency..thats right Phil. You can be whiter than white, better than the best, so ban the Provider Calendars, Provider Tax Guides, Ban the provider Pens, Ban the lot Ban O845 numbers, Ban being a guest at the awards dinners, Ban, Ban, Ban!

Posted by: Smudger

NO SURPRISES...

Everyday we read articles regarding the FSA and how they plan to do this and plan to do that, but everybody should know by now that they make the rules and think about them later. And then they have to change them, and then change them again. Hence, consultation after consulation. Blind leading the blind. They haven't a clue how IFAs work, and they're not interested. They attempt to solve issues that aren't there and dont' - or refuse - to deal with the big problems....like the 'advice' that banks advisers give. Shameful.

Posted by: Keith Jayne

Mission Impossible

What we know: 1. Clients need independent advice and in our experience many/ enough are prepared to pay for it... 2. A c 3% adviser charge on new investment money is commerically viable for adviser and client; 3. Ongoing trail (now adviser charge) of between .25 and 1.5% is acceptable to the market dependent on service proposition. 4. Legacy trail continues for existing relationships 5. Those that want to can take commission on non investment business. So with a number of key questions unanswered and the whole thing being unnecessary, expensive and almost certain to change in 5-10 years when some new FSA supremo wants to make a name for him/ herself, RDR is most certainly difficult but not impossible...

Posted by: Simon

Central Planning Chaos

I have posted everywhere time and time again that central planning - e.g. the RDR - by functionaries who are always ignorant, always but always creates chaos in the spontaneous order that arises automatically from freedom and markets. In this case combine the Failed FSA's ignorance with its arogance and you have the receipe for the most toxic of attitudes. No-one should be surprised about the chaos that will now ensue and the livlihoods that will be destroyed and the private citizens - our clients - who will suffer epic 'detriment' as fallout from the RDR. It will fail.

Posted by: Steven Farrall

Do as We did

No longer in the industry so interesting to look from the outside. 12 years as an IFA - how many FSA visits? One - 2 weeks after we started in 1998. Rules and regulation and all the proposed changes since 1998? We just ignored them all until they were law or we would have spent half our time redoing stuff over and over. Number of complaints over that period? None.

Posted by: Don Thompson

"In our experience"

How often do you hear these pro RDR advisers saying clients are willing to pay 3.0% for lump sum advice, and refer to their own experience. The point about the frog and the tadpole is that, with all due respect, no one has experience of clients willing to pay 3.0% for lump sum advice in an environment where the 3.0% is in addition to what they can purchase the investment for direct from the provider.There is one thing that financial reporters get right, and that is their contention that products that do not pay commission, and investment trusts are usually cited, do not figure in advisers financial planning - unless of course advisers are getting (or rebating) commission from elsewhere in the portfolio. These pro-RDR advisers will probably be the first to disappear...

Posted by: Ken Durkin

Rubbish Ken

You have spouted some rubbish here Ken. Clients only know where to go following the advice we give. And if after the advice they want to do it themselves fine. They pay us for the time we take to assess the situation and to make recommendations. We then can implement the plan using clean contracts. It works, we are very profitable and already RDR compliant - however adviser charging finally ends up.

Posted by: Sam Caunt