Choosing a legitimate financial adviser
There are several steps you should always take when choosing a legitimate financial adviser.
One of these is checking that they and the firm for which they work appears on the Financial Services Register.
This is a public register maintained by the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA).
It lists the firms they regulate and the individuals they have approved, making it a valuable source of factual information for any consumer carrying out due diligence on their adviser.
We were pleased to hear today that the FCA is going to consult later this year on proposals to make information available on a wider range of individuals at authorised firms.
Despite the financial services register currently being in place, the FCA published proposals last July to extend the Senior Managers and Certification Regime (SM&CR) to almost all regulated firms.
As a result of these proposals, the FCA will only approve the most senior individuals within firms.
It means that only Senior Managers will appear on the financial services register in the future, removing a valuable source of information for consumers.
SM&CR means that regulated firms become responsible for assessing the fitness and propriety of their employees and ‘certifying’ certain individuals who are not Senior Managers, but whose jobs mean they can still have a significant impact on customers, firms and market integrity.
When the FCA made these proposals, they received a lot of feedback about the public value of them maintaining a central public record of certification employees and other important individuals in regulated firms.
As a result of the SM&CR proposals, individuals within regulated firms including financial advisers will no longer appear on the financial services register.
The FCA has listened to the feedback and now plans to issue a consultation by the summer on policy proposals to address the removal of individual financial advisers from the financial services register.
In addition, the FCA is going to issue an update soon on its work to improve the usability of the financial services register, which in its current incarnation is a bit ‘clunky’ and not especially user friendly.
Here at Informed Choice, we are pleased to see the FCA making plans to maintain this important register for individual financial advisers.
Every consumer who is engaging with a financial adviser should be checking both the individual adviser and his or her firm against the financial services register, to make sure they are legitimate.As a result of the SM&CR proposals, individuals within regulated firms including financial advisers will no longer appear on the financial services register. Click To Tweet