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Support the campaign for Fair Liability 4 Advice
AIFA believes that the financial advice profession needs a longstop to limit open-ended liabilities in line with other professional services.
With your support we believe we can achieve that change.
Watch the video of Chris Hannant, Policy Director, explaining why liability for advice should be capped after a number of years.
The call for a longstop for the advice profession is one that has been consistently made in the industry and one that AIFA has been leading.
What is clear is that there is widespread agreement that the current situation is both unfair on advisers and a barrier for the profession. With the Financial Services Bill currently before Parliament there is no better opportunity to raise the issue of adviser liability with policymakers whilst at the same time drive forward a potential solution.
Campaign objectives
Partnering with Zurich, the campaign will:
We want to raise awareness of the campaign amongst advisers and one of the ways we are doing this is by working closely with the media, and in particular, leading adviser publication, Financial Adviser and its website FTAdviser, where full coverage of the campaign can be found.
We would like the industry to get behind the campaign and demonstrate just how fundamental this issue is to the long term future of the industry.
By showing your support to the campaign, you're helping us to make a real difference.
Look out for regular updates over the coming weeks
AIFA is consulting and engaging a wide range of stakeholders to raise awareness and influence the campaign. These include:
Sign up to our campaign today
AIFA believes that the financial advice profession needs a longstop to limit open-ended liabilities in line with other professional services.
With your support we believe we can achieve that change.
Watch the video of Chris Hannant, Policy Director, explaining why liability for advice should be capped after a number of years.
The call for a longstop for the advice profession is one that has been consistently made in the industry and one that AIFA has been leading.
What is clear is that there is widespread agreement that the current situation is both unfair on advisers and a barrier for the profession. With the Financial Services Bill currently before Parliament there is no better opportunity to raise the issue of adviser liability with policymakers whilst at the same time drive forward a potential solution.
Campaign objectives
Partnering with Zurich, the campaign will:
- Call on advisers to support our call for the Financial Services Bill to introduce a longstop or require the new regulator, the Financial Conduct Authority, to introduce it for the advice profession at a later date;
- Research the impact of long term liabilities on the advice profession and the attractiveness of firms to long term investment;
- Explore the existing options available for advisers and help them understand, limit and manage their long term liabilities;
- Call for a clear and compelling case for change in Parliament on behalf of advisers.
- Remove disincentives to investment in the sector and help growth
- Consumers need and deserve a robust financial advice profession. To achieve this, firms must be able to quantify risk and exposure, to seek capital investment, for which a longstop is necessary.
- There are few alternative solutions to dealing with open-ended advice liabilities and we are seeking action from the industry.
- The Financial Services Authority has previously promised to review the need for a longstop. Given the transition to a new regulator, if Parliament does not act there must be a firm instruction for the new regulator to undertake this review once it is formed.
- The current Financial Services Bill going through Parliament provides an opportunity for an amendment.
- Minimise consumer detriment
- In the past few years the FOS has seen a significant decline in the already small number of potentially time barred cases.
- Three out of four consumers who received professional financial advice said there should be some limit. Over half of them believed the liability should end in less than 15 years (YouGov survey 2007).
- One in four consumers think that IFA responsibility should end when the relationship between the client and IFA ends.
- The marginal increase in cost to consumers in extending the longstop to the FOS is neglible because of the potential use of s404 redress schemes, for cases of widespread detriment.
- We believe the introduction of a longstop supports the government's consumer responsibility agenda.
- Bring advisers in line with other professional services
- There are comparable longstop limits (Statute of Limitations) for other professional services.
- Introducing a longstop will help to engender greater consumer confidence comparable with other professional services.
- Creating a level playing field for all professional services supports the government's desire to raise standards amongst advisers in light of the Retail Distribution Review.
We want to raise awareness of the campaign amongst advisers and one of the ways we are doing this is by working closely with the media, and in particular, leading adviser publication, Financial Adviser and its website FTAdviser, where full coverage of the campaign can be found.
We would like the industry to get behind the campaign and demonstrate just how fundamental this issue is to the long term future of the industry.
By showing your support to the campaign, you're helping us to make a real difference.
Look out for regular updates over the coming weeks
AIFA is consulting and engaging a wide range of stakeholders to raise awareness and influence the campaign. These include:
- The government
- Members of Parliament - Mark Garnier and Mark Duggin
- The regulator
- The adviser community
- Consumer Groups
- The media - Financial Adviser
Sign up to our campaign today
Regulatory news:
| > | Financial Services Bill | |
| > | AIFA responses |
Related links:
| > | Chris Hannant interview with FT Adviser | |
| > | Zurich Intermediary | |
| > | Financial Adviser | |
| > | FFWD |