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Can the FCA Hear Us Independents At All?

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Don't get mad, says Gill Cardy, MD of the IFA Centre – Get Even. But you're going to need some help


IFA Centre was founded at a time when all other organisations explicitly or indirectly involved in representing the interests of Independent advisers, rather than demonstrating wholehearted commitment to the theory and practice of Independence, were rapidly embracing Restricted advice models. 

We know that Restricted advice comes in many forms, from ‘nearly Independent’ advisers forswearing an extremely specialist activity to single company operations like Prudential and St James’s Place.


A recent discussion on LinkedIn, prompted by a new member’s open letter to the adviser community regarding the future of IFA Centre, has taken an extremely illuminating turn.  I am indebted to Eric Fandrich of the Nomura Research Institute for sharing some extremely pertinent observations.


Restricteds Have the Biggest Elbows
Eric has identified who responds to major consultation papers.  Of some 1,800 responses, he says, 1,300 were from individual people or firms – which, as he points out, means that there is a high risk that key messages to the regulator and recommendations for action are diluted. 


The companies and organisations who respond most frequently to consultations are worth studying.  Not one represents Independent advisers exclusively.  Some represent advisers in general, with the full range of advisers in membership, from Independent through multi-tied firms to single tie companies.  The largest businesses who regularly respond to consultations are banks, insurance companies, and the largest networks – none of whom represent Independent advisers exclusively.


I know that many question why we need “yet another” organisation, and that they liken this whole debate to the Pythonesque People’s Front of Judea / Judean Peoples’ Front debate.  But I look at these statistics and ask myself: “if IFA Centre did not exist with the sole focus of speaking up for Independent advisers who would?”

Time to Be Heard
And yes, there are instances where any regulated organisation will form similar opinions.  Differentiation is then less relevant, and attempts to work together with other organisations to make a stronger voice on these subjects should be welcomed instead of ignored. 


But what is obvious from the list of those who respond to regulatory consultations on a regular basis is that they have financial and human resources.  IFA Centre is member-funded, as our independence should not be compromised by reliance on product provider funding.


Which self-evidently means we need members!   


Which is why, if Independent advisers want me to bat on their side in 2014, they need to look at the bigger picture. Who else is lobbying the FCA or the Treasury, and what subjects will they be lobbying about?   If their interests favour, or even support a Restricted business model, then it's not going to be Independent financial advice is it?? 


Running IFA Centre is not a job for an adviser to do in their spare time, as some suggest.  I also query whether it’s a job for anyone who has not actually been an adviser, struggled with RMAR, fought with FOS, agonised over PI availability and costs, paid relentless and ever-increasing regulatory invoices, and all because they, like me, believe that Independent advice is simply the best solution for their clients, and it’s worth fighting for. 
   

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