APFA: Three Steps Toward a Future of Better Regulation
25 September 2014
Second in a series of reports to mark APFA’s 15th anniversary
The Association of Professional Financial Advisers (APFA) has set out three ways in which it thinks the FCA should approach future regulation of the advice profession in order to improve outcomes for firms and for consumers. This comes as APFA today publishes the second in a series of reports looking at the advice profession, “The Future of Regulation”, in conjunction with report sponsor Zurich.
Chris Hannant, Director General of APFA, said:
“We want the regulator of the future to be three things. Firstly, it should be flexible. Where patterns of consumer behaviour change, the rules and focus of the regulator should adapt accordingly. Secondly, it should be proactive. The more issues that are nipped in the bud early, the better – especially if it reduces compensation claims later down the line. Proactive intervention also helps to enhance the reputation of the wider financial services industry. Thirdly, we need a regulator which acts proportionately. It seems obvious, but fussing over trivial matters is counterproductive. Actions must be weighed against their impact on consumers, firms and markets.
“A positive sign emerging from our new report is that the FCA appears to share these priorities. In his article, Chris Woolard says that they have committed to being proportionate. He also recognises that firms should be in a position to focus on the needs of their customers. This is critical, because unless the way the regulatory structure works is improved it will be increasingly hard for firms to offer affordable services.”
Richard Howells, UK Intermediary Sales Director at Zurich comments:
“A critical role of the regulator of the future is to introduce measures which are fair, reasonable and proportionate. A prime example of this is the long stop. Complaints after 15 years or more may make up a small proportion of the Ombudsman’s workload, but their potential to damage the attractiveness of the whole industry is substantial. The lack of a credible longstop has impaired the effective operation of the current regulatory setup. We have a chance to address this in a way that will not only bring financial advisers into line with other professions, but that will also make the advice industry a fairer and more attractive place to set up and expand a business. This, in turn, would play a significant part in maintaining access to advice for consumers at a time when individuals need full, professional advice more than ever.
“We’re delighted to sponsor this latest report from APFA highlighting the common challenges in the regulation arena facing advisers, and remain committed to campaigning on the long stop, and finding a solution which meets the needs of advisers and at the same time provides consumers with appropriate levels of protection.”
APFA and Zurich launched the Fair Liability 4 Advice campaign in 2012 and have been calling for the introduction of a fifteen year long-stop to limit adviser liabilities.
The publication of this series of reports celebrates the 15th anniversary of the formation of the Association of Professional Financial Advisers (APFA), formerly known as AIFA, looking ahead to the next 15 years.
The Future of Regulation includes commentary from industry experts on key issues affecting the advice sector today:
- Chris Woolard, Director of Policy at the FCA, shares his vision about how the FCA should develop in the long term;
- Chris Hannant, Director General of APFA, highlights how he believes a good regulator should operate;
- Richard Howells. UK Intermediary Sales Director argues the case for a longstop, to get a fairer balance in the liabilities facing advisers;
- Iain Anderson, Director and Chief Corporate Counsel of Cicero Group, considers the political implications for regulation;
- Nic de Maesschalck, Director of BIPAR (the European trade association for insurance intermediaries) considers the impact of EU and the implications for regulation in the UK.
For more information on the APFAs 15th anniversary or to obtain a copy of the report please click here.
ENDS
