The webinar here focuses on the background and findings of the FCA RDR thematic reviews and discusses good practice in disclosure and delivery of services.

The FCA issued results from their first thematic review in July 2103 and their second in March 2014. The second stated that the findings were ‘Unacceptable’ and this was because a number of issues highlighted in July 2013 had not improved. The results of the third review issued in December 2014 showed a good improvement.

Disclosure of Adviser Charges

Key points from the thematic reviews:

• Disclose ongoing charges in cash terms;
• If using indicative hourly rates disclose the total estimated number of hours for each service;
• Avoid wide ranges;
• Only quote charges you actually use.

The FCA research identified that:

• Consumers struggle to engage with disclosure documents (a number of design tips and good practice steps were discussed);
• Consumers value service and are happy to pay for good service;
• Disclosure documents should ideally be no more than 4 pages.

Ongoing service

You should clearly outline your ongoing service and avoid vagueness.

Service levels should also be tangible. For example, the FCA does not consider “we are available 9-5 so please contact us if you need any help” to be a valid ongoing service.

You should have a diary or scheduling system to ensure that clients receive the ongoing service that they pay for and you should be able to demonstrate delivery.

The FCA see no need to continue with thematic reviews in this area and supervision of RDR will now become business as usual. The FCA did stress that when visiting firms they will review the disclosure documents very carefully and will be looking to ensure that they are clear and compliant. The FCA encourages all firms to use their disclosure assessment tools – see related ATEB article here.

All the FCA thematic review work can be found here.