The Financial Services Authority (FSA) today said it was "time to put right" problems it had identified with advisers switching client investments.
Linda Woodall, FSA head of investment intermediaries, said the regulator was disappointed to find examples of poor advice after reviewing some 180 customer files across 17 businesses.
The FSA calls the practice 'replacement business', referring to any case where an adviser switches a client's investment from one product or solution to another.
It has published examples of good and poor practice it uncovered during the thematic review, which originally related to firms' use of 'centralised investment propositions such as distributor-influenced funds (DIFs), discretionary fund managers (DFMs) and model portfolios.
The FSA said its review also alerted it to concerns about replacement business.
Speaking to IFAonline this afternoon, Woodall said that, although the causes of problems varied between firms, it was "time to put this right".
"In respect of replacement business, we were disappointed to find a persistence of issues where we have commented on more than once before," she said.
Woodall said there are three areas firms must concentrate on: the cost to the client of switching their investment; justification for switching; and ensuring they demonstrate why the clients' existing arrangements no longer meet their needs.
Woodall said there were no further thematic reviews in the pipeline, but she said the regulator would follow up on the issues it had identified as part of its normal supervision work.
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