The IMA says all advises ought to be professional and adds that the term ‘general’ is meaningless and could sound perjorative. It does however say that there could be good reason for the advice industry to have its own demarcation between financial planners and advisers, based on qualifications and experience, and there is no reason why these could not be explained to clients.
Its submission does call for one label to continue to be defined by the FSA – that of the independent financial adviser. The IMA says the term independent is gradually becoming a recognised brand with consumers and it would be unwise to lose what has already been achieved. It proposes that the regulatory distinction between independent and non-independent advice ought to remain and that independent ought to continue to mean whole of market.
Julie Patterson, director of authorised funds and taxation at the IMA, says: “It’s no secret that commission-driven mis-selling exists in the retail advice market and that professional standards are not consistent. But simply adding to the complexity of labels will not tackle this. The FSA’s commitment to improving standards and transparency in remuneration is welcome; not only will it help to tackle mis-selling, it will also give consumers assurance that they are getting the best advice possible.”