The Financial Conduct Authority's (FCA) due diligence review has been labelled "disappointing" by a consultancy, which claimed it failed to address critical issues advisers face when outsourcing portfolio construction for their clients.
The lang cat warned the FCA's work was "too high level" and failed to spot issues around adviser due diligence on the most common outsourced investment options - multi-manager (MM) and discretionary fund managers (DFMs) - which it had raised in two consecutive reports. A joint report by the lang cat and CWC Research, out in February, had found it was impossible for advisers to compare charges for the investment options, and warned this was putting them at risk of allegations of negligent advice. The FCA published its thematic review of advisers' due diligence processes on 19 February,...
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