FSA takes big step to help consumers – latest Retail Distribution Review changes

25 June 2009

In response to today’s publication by the FSA of proposed changes to the rules for investment advisers coming from the Retail Distribution Review, Adam Phillips, Acting Chairman of the Financial Services Consumer Panel said:

"The FSA has taken a big step today towards creating a financial advice system which the consumer can trust. The proposal to remove commission bias will help people to get independent investment advice that reflects their needs and is not influenced by the product provider.

“We have encouraged the FSA throughout the process of the Retail Distribution Review to take radical steps which will give consumers greater confidence in financial advice and help them to engage with the industry. It is only by being open with consumers about the cost of advice and any financial relationship between the adviser and the product provider that the industry can hope to improve its credibility. The FSA’s plans to introduce clearer payment structures, more realistic descriptions of the different types of adviser and improvements in professional standards give the industry this opportunity."

The Consumer Panel will continue to promote the consumer interest in the ongoing debate on the Retail Distribution Review’s detailed proposals during this next consultation period until 30 October 2009.

Notes to editors

1. The FSA established the independent Financial Services Consumer Panel in December 1998 to advise its Board on the interests and concerns of consumers and to report on the FSA’s performance in meeting its objectives. The Consumer Panel has statutory status.

2. The emphasis of the Panel’s work is on activities that are regulated by the FSA, although it may also look at the impact on consumers of activities outside but related to the FSA’s remit. What we're doing for consumers explains more about the work the Panel is doing.
   

3. The Consumer Panel brings together a wide range of relevant experience. This includes financial services regulation, working with vulnerable consumers, consumer protection, consumer education, front-line money advice, legal expertise, competition policy, public policy analysis, market research and media.

4. There are currently ten members of the Panel as listed below (for further information on individual members, see Who is on the Panel)

Adam Phillips (Acting Chairman)
Kay Blair
Michael Chapman
Stephen Crampton
Caroline Gardner

Tony Hetherington
Nick Lord
David Metz
Lindsey Rogerson
Carol Stewart