In The Media

You may have noticed the recent media coverage following the findings by Which? that high street banks and building societies are giving poor advice and recommending inappropriate investment products.

In an undercover investigation by the consumer magazine, just five out of 37 advisers in banks and building societies were found to have given good advice about investments. The majority of these advisers showed a poor understanding of the risks of investing and made misleading statements about the features and costs of available products.

According to Which?, many of the bank and building society advisers recommended products that were inappropriate for its researchers, who were all aged over 60 and inexperienced investors. Even worse, added the magazine, just under half claimed there was no cost for their advice, with “only a handful” of advisers being upfront that banks and building societies make money through commission paid for the products they recommend.

A spokesman for Which?, which will report its findings to the financial services industry regulator and call for an investigation into standards of advice in banks and building societies, said: “Our investigation shows that the high street isn’t the best place to go for investment advice. If in doubt, consumers should always talk to an independent financial adviser.”

 

Higher Standards
The RDR is specifically designed to improve people’s understanding of, as well as increase their confidence in, financial advice. It aims to raise the level of professionalism among financial advisers so the minimum qualifications required are being increased and the way in which you pay for that advice is being altered to ensure complete transparency.

At Cutler Financial much of the groundwork for this has already been done. Our continuous professional development programme means both Kevin Cutler and Kevin Reynolds are only a few months away from reaching the new requirements.  

Meanwhile, in terms of payment for our services, the conversation is underway with clients about how the new rules will work – although I am confident we have always been very open with you about the cost of our advice and how those charges are met. While the logistics may change slightly, therefore, nothing the new rules are asking of us should come as a shock.

 

Further Information
It should, however, go without saying that if you have any questions about the new rules, are concerned about what they mean for our relationship with you or would just like to talk to us about any investment, tax or other financial matter, please do not hesitate to get in touch.