The Association of Independent Financial Advisors (AIFA) says it is pleased that the Financial Se...
The Association of Independent Financial Advisors (AIFA) says it is pleased that the Financial Services Authority is listening to concerns that have been expressed regarding changes to the polarisation scheme.
The FSA has already reduced the scope of its original proposals by excluding CAT marked ISAs and has described its moves towards liberalising polarisation as cautious.
AIFA is continuing to query whether a depolarised approach in the area of stakeholder downplays the key question of suitability. AIFA insists that just because the stakeholder pension is regarded as 'safe', it does not necessarily make it suitable for all investors - suitable advice, says AIFA, must remain a key component of consumer protection.
Commenting on the FSA's announcement regarding its restricted liberalisation of the polarisation regime, AIFA's chairman, Lord Hunt, said: "The FSA looked over the precipice, realised that consumers would be in danger of losing out and is now rightly emphasising the need for caution when considering any amendments to polarisation."
AIFA expressed concern about the confusion of the lines between independent and tied advisors by the introduction of a third type of advisor. It also questions how the status of these hybrid advisors, who adopt other companies' products, will be explained to consumers and how these advisors will demonstrate how they have selected the most suitable products.
AIFA added that it has yet to see the detailed rules which will explain how status disclosure will be communicated.
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