IFA responses to the FSA's ‘Treating Customers Fairly' report have not exactly been positive, as many intermediaries might expect.
Details of the FSA report published by IFAonline on Tuesday 27th July expressed concerns about the possibility ADVISERS at six “large firms” may still be influenced according to the commission they earn rather than what is best for the client.
Although this appears to refer to life offices, the association of advisers being commission-driven has rattled several IFAs who say they are tired the IFA suggesting advisers are only interested in lining their pockets.
Other ‘tongue-in-cheek’ comments by the FSA in this document suggested “being nice” is not the same as treating customers fairly.
Here are a selection of the comments sent to the IFAonline editorial team.
IFA name and address supplied to the editor
The hypocrisy of the FSA defies belief. They have whined on about commission to the extent that it has become a dirty word.
How many financial advisers would it take, working their socks off on stakeholder pensions and Isas, to filter enough commission via the financial services industry to pay Mr Tiner's remuneration package alone, apart from all the rest of this naive quango which is so detached from any form of reality in the distributing of life & pension products.
The job description ' Life Assurance Salesman' has been so demonised by a rabid press and gullible regulators that it has been added to the same list as the Dodo.
In the industrial estate where I try to scrape a living from financial services there are two x two-man practices. Between the four of us we have not netted in the last twelve months the bonus that Mr Tiner awarded himself in order to spend the excess that the FSA have screwed out of the public via our industry.
The real problem with our industry has always been that the people who do the job at ground level have been forced to act as a conduit for the vultures who want to live of this industry without working in it.
If the cost of regulation, PI cover, training and compliance and all the other extortionate costs we endure were built into the contracts and our actual net profits were shown on the illustration as being the true commission levels, then we would have the population’s sympathy rather than their wrath.
Perhaps these un-elected regulators would be the ones having to justify the commission they receive which is disguised as wages.
A “frustrated (female) IFA” writes:
It would be most interesting to know which 6 groups were involved in the survey and from which section of the industry. The way this has been presented yet again is to tar the whole industry with the same brush.
I take it further in assuming that 'TCF' is the latest gimmick from a regulator more concerned with its own image than those of an unsuspecting public. I would be much more impressed if some of the work they carry out - for which I am paying - was of some benefit to said public.
I would then not be in the position of explaining to my pension clients why they are trapped in such expensive old-style pensions because of exorbitant transfer penalties. A matter of such dire importance as to have been completely ignored by the FSA.
No of course not, take the route of the CSA and beat the soft target!!
A representative of one life insurance firm suggests:
Transparency is key. Insurers must declare performance statistics (including complaints, how long it takes for telephones to be answered, how long it takes to pay a claim etc). Customers will then have the information to make more responsible purchasing decisions. The FSA and the Ombudsman need to be more transparent and customers need to be more demanding.
An irate IFA says:
I see the FSA is still bleating on about the evils of commission. What sort of crazy Marxist institution is the FSA anyway? Why not go the whole hog and make making any profit by any company anywhere illegal.
The Tories have got the right idea. Abolish the FSA completely.
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