FCA find larger financial advisers offered more acceptable disclosure

Wednesday 15 November, 2017

Financial Conduct Authority Suitability Review findings

The Financial Conduct Authority (FCA) recently conducted a Suitability Review of 656 IFA’s and intermediary firms.  Although overall it found firms were generally providing suitable financial advice there were variations in the disclosure offered by different size firms.

Firms with two or fewer advisers scored 42.2 per cent on acceptable disclosure measures whilst of those firms with over 25 advisers 63.9 per cent had acceptable disclosure.  The FCA reviewed 1,142 individual pieces of advice focused on pensions and investment personal recommendations to ensure the suitability of advice delivered by firms to retail customers in 2015.  The FCA chose 2015 because it coincided with the changing landscape of the pension reforms at that time.

Simon Hawker, Managing Director at Lonsdale Services and member of the St Albans financial planning team said:

 ‘The FCA findings are interesting and demonstrate the importance of having procedures in place for offering financial advice, which is easier for a larger company with more resources.  At Lonsdale Wealth Management our thirteen financial advisers undertake training every year so our clients can be confident that we offer suitable financial advice which is consistent across all our offices.  We also employ Lee Anne Peters, Quality Assurance, St Albans to review the financial advice we offer clients by monitoring and checking our client files.  We also outsource our compliance to a large independent company who review our standard documentation such as client agreements and engagement letters.  This enables us to provide our clients with the correct documentation and information at all times.  We also provide a clear charging structure and discuss our client fees before we offer financial advice.  We are currently reviewing all our client resources to ensure we are compliant with Mifid II legislation introduced from 3/1/17.’

For more information read: Simon Hawker, independent financial adviser, St Albans, Hertfordshire - 'How is Lonsdale preparing for Mifid II legislation

 

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