Novia CEO Bill Vasilieff says the recent FSA review highlighting investment suitability failures at wealth management firms has exposed shortcomings in Know Your Client Information.
The recent "Dear CEO" letter from the FSA to the heads of wealth management firms followed a review where 14 out of 16 firms contacted were judged by the FSA to pose a high or medium-high risk of client detriment on suitability concerns. Overall, 79% of files examined fell short. It is important to recognise in many cases the problems have been caused by shortfalls in the advice process resulting in a lack of, or out of date, Know Your Customer information. Advisers should be aware that the FSA "consider suitability - and the ability to demonstrate it - a key area of risk" and adviser...
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