Without robust questioning regulation will strangle growth, entrepreneurship and the essential dynamism that benefits consumers, according to Chris Cummings, director general of the Association of Independent Financial Advisers (Aifa) and the Association of Mortgage Intermediaries (Ami).
Speaking at the annual Aifa and Ami London Conference, Cummings warns the intermediary industry faces numerous challenges such as the rising costs of the Compensation Scheme, the review of the Financial Ombudsman Service (Fos), the accountability of the Financial Services Authority (FSA) and European regulation.
He adds: “The costs and burden of regulation creep up year upon year. Taken on their own, each may look reasonable, of little concern. That is why we must always question – is this necessary? How much will it cost? What benefit will result?”
Walter Merricks, chief ombudsman at the Fos, says although the majority of complaints against IFAs are not upheld, the Fos is aware that when a small firm has received more than the two free cases the fact that further complaints may not be upheld provides little comfort because the firm still has to pay the case fees.
He states: “We realise that this can cause resentment and I have some sympathy with this. We will be publishing a consultative paper next month which will address how we are funded and the issues surrounding the case fee and the general levy.”
If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Emily Perryman on 020 7968 4554 or email [email protected].IFAonline
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