FCA tweaks guidance on what constitutes 'advice'

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The Financial Conduct Authority (FCA) has set out its final definitions of regulated advice and personal recommendations in retail investment, in a move it hopes will help firms develop 'low cost' distribution models with confidence.

The regulator consulted on the terms last year following confusion among advisory firms and other stakeholders in relation to ‘simplified' advice, decision trees, model portfolios and how the Financial Ombudsman Service (FOS) would treat complaints. Clarity was necessary, it said, because it felt uncertainty may be preventing firms from developing products or services, particularly low cost online advice or execution-only investment models. Its final paper is largely identical to the suggested guidance on which it consulted.   Clarity? One persistent area of confusion centred ...

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