Business analyst Business insurance Profesional Service Project Management Sales Management Strategy Management

FCA high-risk product move 'good start' say Planners

Financial Planners have told Financial Planning Today that they welcome the Financial Conduct Authority (FCA) proposals to strengthen financial promotion rules for high-risk investments, but also suggested more work should be directed at banning other unregulated speculative investments.

A discussion paper published today by the FCA is seeking views on whether more types of investments such as equity shares should be classified as high-risk investments, how it can further segment the high-risk investment market and what risk warnings they should have attached, and whether there should be more requirements to monitor financial promotions on an ongoing basis. 

Keith Churchouse, director and Certified Financial Planner at Chapters Financial, said issues surround financial promotions have been a problem for a while but have been exacerbated by the Coronavirus pandemic.

He welcomed the proposal from the FCA to extend the classification of high-risk investments.

He said: “The issues surrounding financial promotions have been

Read the rest
Business analyst Business insurance Profesional Service Project Management Sales Management Strategy Management

Retirees drawn to riskier investments warns FSCS

The Financial Services Compensation Scheme has warned that retirees are being tempted to put money into investment products claiming to offer high returns due to the prolonged low interest savings environment.

One in five retirees has considered riskier pension and investment products as they offered a promised higher rate of interest or return, according to new research from the compensation body.

The FSCS said these high return products would, in normal times, be mostly ignored by savers and investors.

The research also found that just 12% of retirees have taken advice from an adviser to see how they can make their money go further.

The research also looked at how retirees viewed the protections offered by the FSCS. Although the majority (69%) of those investing said they knew all their investments were FSCS protected, only 36% of investors knew the exact amount of FSCS protection available for their money.

{loadposition

Read the rest
Business analyst Business insurance Profesional Service Project Management Sales Management Strategy Management

LCF victims get green light for ISA reinvestment

HMRC has given London Capital & Finance (LCF) ISA investors the green light to reinvest their Financial Services Compensation Scheme (FSCS) compensation payments into a new or existing ISA. 

The reinvestment will not count towards their £20,000 annual ISA allowance.

HMRC said it had reviewed the position of LCF ISAs and that HMRC would consider the bonds issues by LCF void and therefore not inside an ISA wrapper.

This means that any LCF customer who received compensation from the FSCS and held an LCF ISA can use some or all of their FSCS payment to make a single ‘defaulted investment subscription’ to a new or existing ISA. 

Reinvestment must be made within 180 days of receiving compensation.

Where FSCS compensation was received before 19 April 2021, HMRC will treat the date the FSCS compensation was received as 19 April 2021. This makes sure that all investors have a full 180

Read the rest
Business analyst Business insurance Profesional Service Project Management Sales Management Strategy Management

Which? says Google and Facebook failing to axe scam ads

Campaigning consumer group Which? says Google and Facebook are failing to remove online scam adverts even after fraud victims report them.

Which? surveyed 2,000 UK consumers in February and found nearly 15% had been victims of online scams.

The consumer lobbyist says the problem suggests that the reactive approach to fraudulent content taken by online platforms is not fit for purpose. 

However, Google and Facebook have defended their efforts to crack down on scams and point out they are making huge efforts to weed out scammers.

Which? found that a third (34%) of victims who reported an advert that led to a scam on Google said the advert was not taken down by the search engine.

{loadposition hidden2}

A quarter (26%) of victims who reported an advert on Facebook that resulted in them being scammed said the advert was not removed by the social media site.

Which? says flaws with

Read the rest
Business analyst Business insurance Profesional Service Project Management Sales Management Strategy Management

Minimum pension age plans risk “retirement lottery”

Government plans to increase the age that savers can first access their pensions from 55 to 57 risk creating a “retirement lottery”, according to investment platform AJ Bell.

The platform and SIPP provider says the problem centres on proposals to allow people with an “unqualified right” to access their pension from age 55 on 11 February 2021 to retain this so long as they do not transfer to a different scheme.

This could create a complex two tier system, warns AJ Bell, with some people able to access their pension from 55 and others unable to do so until 57.

Instead, AJ Bell has urged policymakers to take a simpler approach by increasing the pension access age to 57 for everyone by 2028.

Tom Selby, senior analyst at AJ Bell, said: “The Government’s proposed approach to increasing the age people can first access their pension pot from 55 to 57

Read the rest
Business analyst Business insurance Profesional Service Project Management Sales Management Strategy Management

FCA appoints first ESG director 

The FCA has appointed Sacha Sadan, currently director of investment stewardship at LGIM, as its new director of Environment Social and Governance (ESG).

The role is a new one for the regulator and was announced by FCA chief executive Nikhil Rathi this week to coincide with Fintech Week.

The FCA also announced two key tech appointments this week as part of its plan to become a data-focused regulator.

Mr Sadan will help develop and promote the FCA’s approach to sustainable finance here and overseas. 

{loadposition hidden2}

A key part of his role will be to lead the development of policies to ensure the “long-term safety and soundness of firms, the proper functioning of markets and the protection of consumers.”

Mr Rathi said: “We welcome the recent addition to our remit of a requirement to have regard to the UK target of net zero carbon emissions. I am delighted to have

Read the rest
Business analyst Business insurance Profesional Service Project Management Sales Management Strategy Management

Editor’s Column: Has the compensation genie been unleashed?

The rules of financial regulation were effectively torn up and rewritten this week after the Government stepped in and launched a £120m compensation fund for victims of the London Capital & Finance collapse.

I’ve written several columns about this fiasco, which saw more than 11,600 investors cheated out of £237m of their savings by the mini-bond provider which failed in 2019.

After a huge amount of deliberation the Financial Services Compensation Scheme has compensated about 1 in 4 investors but it was looking increasingly likely the FSCS would reject the rest of the claims because they fell outside the ‘regulatory perimeter’ as the FCA would put.

{loadposition hidden2}

The regulatory perimeter is a critical concept which I’ll return to later but first: what prompted the U-turn by the Government?

Was it the fear of huge swathes of criticism for leaving thousands of LCF investors adrift, followed by years of litigation?

Read the rest
Business analyst Business insurance Profesional Service Project Management Sales Management Strategy Management

Confidence no substitute for good financial advice

Feeling financially confident is no substitute for the benefits of financial advice, according to new research.

Feeling ‘financially confident’ is not indicator of level of knowledge and no guarantee that better financial paths are taken, according to new research from Aviva.

The survey from Aviva Financial Advice of 2,000 UK savers saw 45% of ‘confident’ respondents incorrectly say pensions do not attract tax relief and 23% not know that the level of state pension can be affect by the amount of National Insurance paid. A further 28% of ‘confident’ respondents did not know what age they would receive their state pension.

Almost two thirds (62%) of advised customers surveyed said that having a financial adviser had had definitely prevented them from making significant financial mistakes. In contrast, only a quarter (25%) of non-advised respondents conceded that they had made financial mistakes that would have been avoided if they had received

Read the rest
Business analyst Business insurance Profesional Service Project Management Sales Management Strategy Management

FSCS declares 11 firms in default including BSPS adviser

The Financial Services Compensation Scheme (FSCS) declared 11 firms in default in March, including several wealth managers and IFA firms.

The move opens the door to clients of the firms claiming compensation from the FSCS.

Wealth managers in default included: Bartholomew Hawkins Limited, trading as Turris Porta Wealth Management Limited in Cardiff; Blakemore Wealth Management Limited in Wolverhampton and Active Finance (Scotland) Limited of Ayr. 

Bartholomew Hawkins Limited was involved in giving pension transfer advice to members of the British Steel Pension Scheme (BSPS).

{loadposition hidden2}

Fiona Kidy, FSCS’s chief financial officer, said: “FSCS is here to protect consumers across the UK and to contribute to financial stability. We are reaching out to consumers to let them know that compensation may be available if they have suffered losses due to a failed financial services firm. 

The FSCS began in 2001 and has helped 5.5m people claim compensation so far.

In

Read the rest
Business analyst Business insurance Profesional Service Project Management Sales Management Strategy Management

Q&A with PFS CEO Keith Richards

Financial Planning Today caught up with Personal Finance Society CEO Keith Richards about his impending departure from the professional body, how he sees the Financial Planning profession’s state of health and his plans for the future.

Financial Planning Today: What made you decide to leave the PFS and what do you plan to do next?

Keith Richards: There is rarely a right time to leave when there is often more to be done but most of my early goals and aspirations for the evolution of the society, its membership and in supporting the CII’s change programme have largely been realised, so now feels like the right time and equally allows the CII to further implement changes. 

Shortly after taking up the position of chief executive, the PFS board agreed to a strategic transformation to evolve the role and purpose of the Society to become a more modern, relevant and inclusive

Read the rest