The
Financial Services Authority (FSA) has proposed changes to the
UK
investment market.
According to the financial regulator, independent advisors will be
remunerated in the future and the commission-based system which
they currently operate on will be scrapped.
Instead, the
FSA wishes to introduce a up-front payment scheme that will
require
investors to pay personally for
financial advice .
Jon Pain, managing director of retail markets at the FSA, told the
Guardian: The review is about regaining consumer trust and
confidence in the retail
investment market, building a more sustainable sector and
making it easier for people to find their way around and get the
help they need.
He explained that to do this there must be specific changes in the
financial sector and investors should consider how they implement
their suggestions.
Adam Phillips, acting chairman of the Financial Services Consumer
Panel, called the reforms a big step towards establishing a
financial advice system consumers can trust.
Investors will be able to access
independent advice with the removal of the commission system,
he added.
It is only by being open with consumers about the cost of
advice … the industry can hope to improve its
credibility.
