Angela Knight, chief executive of the Association of Private Client Investment Managers and Stockbrok...
Using her speech to the 10th APCIMS Annual Converence, Knight said the burdens being placed on companies within the industry were beginning to take on unnecessary proportions.
"N2 is part of the reason why, as this is the point at which the FSA assumes all its new powers and so signals significant changes to all financial firms," she said.
"N2 brings changes right across your business. Do not forget to look at the 'Steps to N2' document we sent to all members a few weeks ago. [It] consists of a series of 'one liners' which all firms need to consider in addition to the Rules. This document still covers six pages. This indicates the extent of the changes," she added.
On Europe Knight said companies would have to spend more in order to keep up with the latest regulations coming out of Brussels.
"Where you do business, how you do business, how you classify your customer, what capital your firm needs to have, and the requirements that listed companies will have to meet are now subject to the EU-wide decision making process."
However, Knight reserved her strongest criticism for the continued use of CGT, comparing it to criminal activity.
"Like crime, the fear of CGT runs very high. Why did so many small investors hang onto Marconi? Answer, CGT. With the market having fallen so fast, never has it been so appropriate to rebase CGT."
All the issues above will push up costs within the industry, Knight concluded, and there seems to be littel hope of a letup in the application of new regulations in the future.
"As soon as one initiative has been flagged, let alone implemented, by one of the organisations, another initiative is announced by a second. Fron complaints handling to unit trust reconciliation. From N2 to settlement netting. From increasing the complexity of taxation to the Myners and Sandler reviews. From the Basel Capital Accord to the Investment Services Directive. Whilst individually they each have their merit, taken collectively the consequences is one of increasing operating costs for little if any discernible benefit."
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