The FSA mellowing?

Thursday, 6th October 2011 18:46 - by Resident IFA

I have written before on the subject of the Financial Services Authority’s ‘Treating Customers Fairly’ (TCF) initiative. After my company’s TCF inspection last year, we were given a clean bill of health, the FSA happy that TCF was ‘embedded within our culture’…or words to that effect. I was invited to a follow-up Workshop which took place last week. I was placed in the stream of Workshops which dealt with small firms, yet those with 3 or more Advisers. I didn’t know what to expect, but was pleasantly surprised. Gone were the thumbscrews and overbearing nature a few FSA employees had delivered in the past…replaced with a more caring ‘n’ sharing approach. The first thing said was that those in the room were there as they had a good TCF inspection in 2010; exactly the type of conscientious IFA (Independent Financial Adviser) companies that the FSA wished to nurture and keep within the industry. A breath of fresh air! The whole morning continued on in this vein, with many questions asked…and good, common-sense answers provided by the FSA. One such topic was the ‘Suitability Reports’ Advisers must provide their Clients with after advice is given; explaining the objectives, solution/product details, and action taken…amongst many other things. There was no need for 45-page Suitability Reports, 3-4 pages with appendices being suffice to do the job. I agree. Why confuse Clients with long-winded reports? Concise reports will hold the attention and be more effective, providing all key areas the Client should know are still included. The FSA representative also encouraged the assembled throng to take responsibility for their own decision, not relying exclusively on the (possibly) over-protective guidance of unregulated ‘Compliance Advisers’ – a burgeoning and usually helpful development in the IFA industry over the past few years. Common sense must retain its place…not fear of FSA sanction. So, a refreshing morning spent with the FSA! I like the ‘new’ FSA. They really seem to want to work with us IFAs, not against. I look forward to my future dealings with the FSA, happy in the knowledge that they seem far more in tune with the idea that there are a lot of good IFAs running small firms…all facing challenges to ‘do the right thing’ every day…and succeeding for 99% of the time. This will only benefit the UK citizen; keeping more of the ‘good guys’ in the IFA industry, allowing greater ongoing access to Independent Financial Advice. This can only be a positive outcome. Until next time…