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Topics: blog| Financial Conduct Authority| Keydata| Arch cru
This week, more details were published about the new look regulator post the split-up of the FSA.
One of the more interesting proposals promises new powers for consumer groups, which will be able to force regulators to investigate complaints of mass mis-selling of financial products when the Financial Conduct Authority (FCA) takes over in 2013.
Coupled with plans to allow the regulator to intervene much earlier in product design, the aim is for problems to be nipped in the bud.
If there are issues, then consumer groups will be able to act quickly to notify consumers of the problems and redress should be much faster.
It is to be hoped the plans will prevent the likes of mass mis-selling cases like payment protection insurance from ever happening again.
The new regulator will also have to present a full report to the Treasury if there has been evidence of regulatory failings; a measure it previously didn’t have to bother with.
All well and good but surely IFAs have some role to play here? Their detractors will argue they played a role in some of the recent financial debacles but the truth is many have been just as much the victims as their clients.
Surely they have the right to force the regulator to look quickly and more intensely at issues such as Keydata and Arch cru to ensure the matter is resolved for clients?
Advisers are also in a position to give valuable advice to the regulator and flag up product design flaws as they assess them day in, day out.
We all know some advisers will dismiss products quite quickly if they are concerned about how they work or the returns expected. A move away from a reliance on commission post-RDR will also mean advisers should be taking a more objective view on products and will lack the incentives to back more suspect offerings.
The consumer view is undoubtedly important, but the government and the regulator would do well to utilise advisers’ expertise too.
Katrina Baugh is editor of Professional Adviser and IFAonline.co.uk
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| Comment | From the Editor: Could IFAs influence the new regulator? |
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What IFAs?
You are, of course, absolutely right. The new Regulator (or the old regulator with a new name)will however, be well aware that the sort of IFA that has historically walked away from the likes of Arch Cru, Lifemark, Barlow Clowes etc. will no longer be around in 5 years time, so why involve them. The future IFA will have to have its corporate head so far up its corporate rectum that it will see only those things that the purveyors of toxicity wish it to see. 'Shareholder' interest will be measured against Fee Income and profit will increasingly be the mantra, wrapped up and disguised as 'Customer Relations' Hence there will be no true Independent to comment
Posted by: Grosvenor