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PFS urges FCA to support the profession to ensure consumer access to financial advice

Publication date:

26 March 2020

Last updated:

26 March 2020

Author(s):

Personal Finance Society

The Personal Finance Society has written to the Financial Conduct Authority and HM Treasury outlining actions the regulator and government could take to help the profession help clients and members of the public in need of financial advice at this challenging time.

The communication from the Personal Finance Society, sent to the FCA and HM Treasury on Tuesday (24 March), outlines suggested changes to regulatory requirements that would allow financial advisers to continue working during a period when demand for their help has never been greater, yet pressure on their own resources are stretched.

The communication includes calls for the regulator to confirm that government business loans won’t breach a firm’s capital adequacy requirements as well as the introduction of a four-month waiver for advice firms searching for professional indemnity insurance as there is evidence availability of cover continues to reduce and renewals are being seriously impacted by current lockdown measures introduced by the government to slowdown the spread of the coronavirus.

The professional body has also asked for HM Treasury to consider acting as reinsurer of last resort for professional indemnity insurance ahead of a wider PII/Financial Services Compensation Scheme funding review.

The Personal Finance Society has also requested an extension of the 48-month deadline for advisers to become qualified while giving advice under supervision and for the Mifid II requirement to notify clients when their investments falls by more than 10 per cent to be suspended until further notice.

The communication also requests:

  • The FCA push back the deadline for registering advisers on their directory from December 2020 to December 2021.
  • Given the postponement of examination sittings as a result of government guidance, the FCA push back the deadline for Pensions Transfer specialists to achieve Retail Distribution Review required qualifications. The deadline is currently 1 October 2020.
  • The City watchdog issue communications to the public about the importance of not over-reacting to investment market behaviours during the coronavirus outbreak and seek guidance or advice.
  • A lighter touch is taken to Senior Managers Certification Regime implementation.
  • Relaxing of regulatory financial returns requirements.

Keith Richards, chief executive of the Personal Finance Society, said: “These are unprecedented times and to better meet the demand for more financial advice from impacted consumers, advisers will need help from the government and regulator.

“The impact of COVID-19 will make it virtually impossible for financial advisers to talk to clients face-to-face, with the majority now having to reassure clients and help them with their needs over the telephone or internet, while contending with their own personal challenges.

“Over the coming months, the focus for all stakeholders must be on maximising the amount of time advisers can spend dealing with client needs, especially those in desperate need of the profession’s help.”

ENDS

This document is believed to be accurate but is not intended as a basis of knowledge upon which advice can be given. Neither the author (personal or corporate), the CII group, local institute or Society, or any of the officers or employees of those organisations accept any responsibility for any loss occasioned to any person acting or refraining from action as a result of the data or opinions included in this material. Opinions expressed are those of the author or authors and not necessarily those of the CII group, local institutes, or Societies.

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