Independent advice is not the only option available.
If you go to your high street bank you may be
greeted by a financial adviser, but they could well be ‘tied’ to
recommending and promoting the products of the bank, or a single
insurance/investment company to which the bank has an allegiance. So why
do we need independent advisers, and how can customers be sure they are
getting a fair deal?
The Financial Conduct Authority (FCA)
The
FCA, to give it its shorter title is the government watchdog that
regulates all financial and insurance firms – this ranges from the
largest multinational bank, to the financial adviser operating as a sole
trader. The FCA handbook of rules and guidance lays down the laws to
which all Independent Financial Advisers must adhere, and the way they
treat customers is governed by the ‘Conduct of Business’ (COBS) rules.
The rules are freely available from the FCA’s website – www.fca.org.uk. Please note:
by clicking on this link you will leave our website and enter into a
third party website of which our firm is not responsible for the
content.
How do I know the company I am dealing with is independent?
Independent
advisers are able to select the correct product for customers from the
whole of the market – that means they can potentially recommend any
product from any company providing it suits the customer’s needs and
objectives. With such a wide choice of companies, investments and saving
tools the customer can be reassured that they are not simply being
provided with a standard recommendation – and are getting personalised
advice.
To ensure you do get personal advice your financial
adviser will collect certain details about you and your circumstances to
enable him to correctly advise you. Remember to be as open and honest
as you can, because the more information you provide, the more accurate
the adviser can make his recommendations.
All financial advisers
have to provide their customers with the relevant important disclosure
documents, detailing the following: information on services provided by
the firm, how the firm is paid for the business it conducts, their
complaints procedure, Data Protection and coverage under the Financial
Services Compensation Scheme (FSCS). You can ask to see our disclosure
documents at any time, simply contact us for these.
What protection do I have?
Your
adviser will always endeavour to do the very best for you. Whenever you
deal with a financial adviser you will receive details on the
complaints procedures offered by the firm. If you wish you can request a
copy of these procedures at any time.
When the adviser is
advising you on regulated products (including investments, insurance and
some forms of mortgages) you have the protection of the Financial
Ombudsman Service (FOS) and the Financial Services Compensation Scheme
(FSCS).
If you are unhappy about the advice or service you have
received you should firstly contact the firm that provided the advice or
service. This gives them the chance to put things right and/or to
provide their own version of events. Should you remain dissatisfied you
can refer your complaint to FOS who will investigate the complaint
independently and make a ruling. FOS work with customers and financial
advisers to resolve a complaint, and when they do have to make a ruling
it is binding upon the firm.
If you try to submit a complaint to a
firm and the firm is dissolved, or unable to meet its obligations, you
may have recourse to the FSCS (Financial Services Compensation Scheme).
This is a service funded by all the companies within the industry to
protect customers where firms have closed or gone into liquidation.
Anything else I should know?
Some
financial advisers do give advice on products that are not regulated by
FCA – such as general taxation and some Buy-to-Let mortgages. Your
adviser will explain to you when you are receiving advice on an
unregulated product. It is important you are happy with the advice as
you do not have the added protection of FOS or FSCS when dealing with
some unregulated products.
THE FINANCIAL CONDUCT AUTHORITY DOES NOT REGULATE TAXATION ADVICE AND SOME FORMS OF MORTGAGES
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE