The FCA has launched a Call for Input into what it is describing as Consumer Investment Markets covering the full range of regulated and indeed non-regulated investments which have been causing consumer detriment.
That means it looks at everything from UCIS to mini-bonds to inappropriate or unsuitable regulated advice.
I think the regulator does need to examine things in the round for a host of reasons though there are reasons to be concerned about advisers being 'lumped in' with the Wild West of financial services.
The key for me is that the paper makes another mention of shifting to polluter pays in terms of the FSCS thus I think it is well worth engaging with.
The story is, I think, rather poorly reported across the trades. Although the paper seems to rule out a big shake up in funding groups,I think it still holds out the prospect of significant change.
Professional Adviser’s pretty straight forward report is among the better ones. The paper asks a number of searching questions including -
What more can we do to help the market offer a range of products that meet straightforward investment needs?
How can we better ensure that those who have the financial resources to accept the risks of higher risk investments can do so if they wish, but in a way that ensures they understand the risk they are taking?
How can we use the regulation of financial promotions to make it easier for people to understand the level of regulatory protections afforded to them when they invest?
What more can we do to ensure that when people lose money because of an act or omission of a regulated firm, they are appropriately compensated and that it is paid for fairly by those who cause the loss?
How can people be better protected from scams?
How do we help this market to be competitive, with firms striving to offer better products and services?
Of course the bills continue to pile up.
The FSCS has paid out £2m as Berkeley Burke Sipp pay-outs begin. Interesting to see that the FSCS has seen a total of 1,694 claims against the Sipp provider, of which 58 have so far been successful and 32 have been unsuccessful. The bill could be significant.
IFAs are organising to call for reforms.
Victoria Hicks, founder of adviser action group Financial Planners United says she is encouraging her 500 members to write to the Treasury select committee MPs explained in this Professional Adviser podcast.
In other news, Adrian Grice, the former boss of Aegon has joined 7IM as chairman.
SJP launches three funds for decumulation, the InRetirement, Balance InRetirement and Growth InRetirement funds managed by State Street. I must say I am a little surprised that there haven’t been more funds of this nature launched.
It will be interesting to see the asset allocation and how the funds are blended together.
The FCA has delayed the next part of its suitability review of retirement advice indefinitely due to COVID-19.
This may also present an opportunity for the industry to get to grips with some of the issues – one being the under-recommendation of annuities – not perhaps at retirement but potentially later in clients’ retirement life.
Tax experts tell the Treasury select committee that the current tax treatment of the self-employed may be unsustainable.
John Cullinane, tax policy director at the Chartered Institute of Taxation, said it was “very hard to justify [tax] differences between self-employed, employed and incorporated workers” with the elephant in the room being the employers’ National Insurance rate of 13.8 per cent “which was swiped from the tax system when someone was taken off payroll”.
It may be worth alerting self-employed clients to the possibility of change.
