FSA focus falls on poor practice with contract terms
Published by FT's Financial Adviser 26 April 2012
Last month the subject of unfair contract terms was raised again in a speech by Clive Gordon of the FSA, who outlined the regulator’s view of what consumer contract terms were considered to be unfair, what it considered to be good practice and what it considered to be poor practice.
FSA departures make breaking up hard to do
Published by FT's Financial Adviser 9 May 2012
On 2 April this year, the FSA implemented the next major milestone in the so-called ‘twin peaks’ regulation by splitting supervision of dual regulated firms between the Conduct Unit and the Prudential Unit.
Back on the trail
Published by FT's Financial Adviser 15 March 2012
Last month the FSA published (PS12/3) further clarification and useful examples regarding when advisers can receive trail commission, post-31 December 2012, payable on legacy assets purchased by clients before the retail distribution review comes into effect.
Language lesson
Published by FT's Financial Adviser 1 March 2012Last month, Hector Sants announced the introduction of the 'twin Peaks' model scheduled to be operating within the FSA from 2 April this year.
Meet the new boss
Published by FT's Financial Adviser 2 February 2012Last month, Martin Wheatley gave a speech at the British Bankers' Association to give his vision for the Financial Conduct Authority.
The X-files
Published by FT's Financial Adviser 2 February 2012
In January the FSA imposed a fine of more than £2m for failings by two insurers to prevent files, that the regulator had requested, from being improperly altered. A sobering lesson can be learnt from the events.
An eye on Difs
Published by FT's Financial Adviser 12 January 2012Last month, the FSA published proposed updates to its factsheets relating to distributor influenced funds.
Hot on the trail
The roll out of the RDR regarding the requirements concerning trail commission and legacy commission has not been straight forward.
The Right Appoach
This month the FSA and the Office of Fair Trading have jointly published a consultation paper on proposed guidance to firms in relation to payment protection insurance with the purpose of helping to prevent the problems associated with PPI recurring in a new generation of products. The next generation includes products such as short-term income protection, or debt freeze or debt waiver as elements of a credit agreement or mortgage.
Wishing list
Last month, Lord (Adair) Turner spoke at the Mansion House City Banquet in which he set out how the new authorities (the FPC and the FCA) would undertake their roles and the powers they would need to deliver their objectives, also recognising the constraints they faced and how they need to be tackled and clearly explained to society.
Knock at the door
The next 12 to 18 months will see a considerable change to the retail financial services sector as it prepares for the implementation of the RDR and the commencement of a new regulatory regime, which proposes to be more intrusive and more consumer focused.
The right side
Recently, the FSA fined a financial adviser firm £35,000 and imposed partial prohibitions on two directors and an adviser.
Changing roles
The relationship between financial advisers and discretionary investment managers will change when the new rules under the retail distribution review come into effect. The changes are set out in Policy Statement 10/6 and particularly in Cobs 6.1A.4R, Cobs 6.1A.6G and Cobs 6.1B.5R.
The stable gates
In August, the FSA published figures showing how firms dealt with payment protection insurance complaints in the first six months of 2011. These firms paid £215m in redress between January and June 2011 to customers who had complained about how they were sold PPI. This compensation figure quoted by the FSA comes from just 16 firms (you can guess who they are) who together received a staggering 92 per cent of PPI complaints in the first half of 2011.
The last hurrah
Past experience has shown that when a financial services regulator is in its last throes of life, it demonstrates greater effect in its enforcement capability.
Fine ignorance
In July, the FSA fined one of the largest insurance and reinsurance brokerage and risk management firms in the UK, £6.9m, for failings in its anti-bribery and corruption systems and controls.
Ucis mis-selling
Ucis schemes have always posed potential risks for investors, regulated firms and regulators alike, partly because although Ucis schemes themselves are not authorised, any person carrying on regulated activities in the UK in relation to Ucis schemes (including their establishment, operation and providing personal recommendations) is subject to FSA regulation.
Lessons Learnt
Confidence in the financial services sector as a whole has been at possibly an all time low in recent years, not least because of the fall out of the banking crisis. Under the government’s plans, the UK will move to a new model of regulation, creating three new regulatory arms to replace the Financial Services Authority, generally regarded as no longer fit for purpose.
The Bonus Level
In June, the FSA published its annual report for 2010/11, outlining its performance against the priorities set out in its 2010/11 Business Plan and its statutory objectives.
