The FSA is proposing to introduce Statements of Professional Standing (SPS) for advisers which will be awarded by accredited bodies.
However, the FSA says this approach will not require mandatory membership of professional bodies.
The FSA is also proposing to add links from the FSA Register to those run by accredited bodies to further buoy consumer confidence in advisers' professionalism.
Firms will still be required to ensure all advisers meet the FSA's training and competence requirements, specifically in the three areas of qualifications, continuing professional development (CPD) and ethical behaviour, to give an overall picture of competence.
In CP10/14 Delivering the RDR: Professionalism, including its applicability to pure protection advice, with feedback to CP09/18 and CP09/31, the regulator states it expects accredited bodies will require advisers confirm to the body they have carried out relevant CPD activity.
Accredited bodies will also judge it advisers have adhered to ethical behaviour consistent with that set out in APER.41
Evidence of appropriate qualifications should need to be verified only once, and the FSA Register will confirm, as it does now, that the adviser is an approved person.
Once the accredited body has satisfied itself about the adviser's professional standing, the adviser will receive "durable evidence" or statement from the accredited body to prove the independent verification has been carried out.
Advisers will be required to provide their firm with an SPS issued by an accredited body.
The FSA expects existing professional bodies to apply to it for accreditation.
In return for accreditation, these bodies must agree to certain conditions regarding how they will check advisers are achieving the required professional standards, and the frequency and nature of sampling individual adviser records.
Consultation paper CP10/14 states: "By setting the same requirements for all bodies we expect that this will deliver much-needed consistency in interpreting and monitoring standards by the different bodies."
The basic information the FSA expects to be covered in the SPS and (where appropriate) to be verified by the accredited body is:
• name of adviser;
• name and contact details of the accredited body and a named signatory;
• end date of verification (maximum of 12 months from date of verification);
• confirmation that the adviser's qualification(s) have been verified;
• confirmation that the adviser has signed an annual declaration which states that in the preceeding six months they:
- have kept their knowledge up to date; and
- complied with APER.
• adviser's individual reference number as it appears on the FSA Register; and
• A statement that: ‘People must be approved by the FSA before giving financial advice. You can check if this person is approved by the FSA to give advice
by going to www.fsa.gov.uk/register'
Consultation on today's paper will close on 24 September 2010 and the FSA will use responses to finalise its rules, due to be published in a Policy Statement in December 2010.
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