The FCA seem to be pleased with the way firms have responded to previous RDR Thematic Reviews and the improvements seen in the disclosure of services and charges. However, not to be complacent, they remain concerned that a significant number of firms are still failing to disclose the total cost of ongoing services in cash terms, or not providing an approximation of how long services may take when quoting hourly rates.
As a school report would say ‘still room for improvement’.
They also state that ‘When creating and reviewing information explaining services and charges to consumers, there is scope for firms to further consider its prominence, clarity and accessibility (in addition to compliance with the detailed disclosure rules)’. So, is your disclosure clear and transparent, and are all advisers ensuring that clients fully understand your fees and charges?
The research highlighted the importance that customers place on the ongoing service reviews to ensure investments continue to be appropriate for their circumstances. It is essential therefore that you have a robust and deliverable review process.
The Thematic Review paper can be found here and detail on all three reviews to date here.
Be aware that the FCA has no hesitation in sanctioning firms. Recently, following the thematic reviews, one firm that had not sufficiently engaged with the changes that RDR requires was referred to their Enforcement and Financial Crime Division.
Pension Transfers – considering a workplace pension
Alistair MacDougall Compliance Defined Benefit, FCA, Pension, Pension Transfer, PI, Switch, transfer
We recently reviewed a pension transfer report where the client was recommended to transfer out of the defined benefit scheme into the client’s pre-existing SIPP. We considered that the recommendation to transfer appeared to be appropriate. However, the client had what the FCA calls an ‘available qualifying scheme’, more commonly referred to as a […]