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IFA throws in towel on campaign to restore trust in financial services

by Alex Steger on Nov 12, 2012 at 07:48

IFA throws in towel on campaign to restore trust in financial services

Shane Mullins, chief executive of Nottingham-based Fiscal Engineers, has given up his campaign to restore trust in financial services a year after starting it, according to reports.

The Times reported that Mullins had dropped the campaign, The Question of Trust, and was said to be ‘hugely disenchanted’ by the industry’s ‘apathy and malaise.’

Mullins began the campaign last November but told The Times he was returning to his day job as leading members of the financial services industry ‘failed to face the question of trust’.

He told the paper: ‘While some in the industry have acknowledged the issue and been very supportive the general apathy and malaise has been hugely disappointing and frustrating.’

31 comments so far. Why not have your say?

Paul Barnard

Nov 12, 2012 at 08:22

As I've never heard of it, perhaps some publicity might have been a good idea before accussing others of "apathy", don't you think?

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david mann

Nov 12, 2012 at 08:32

whilst admirable in intention the campaign was always doomed to fail - you cant get people to trust just becasue you ask them to - trust is earned.

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Stevie Boy

Nov 12, 2012 at 08:39

@Paul

There has been a reasonable amount of publicity on Citywire and in national press, although admittedly not so much recently. The fact that you have not heard of it doesn't necessarily mean it was poorly publicised.

I have never met Mr Mullins but if he has been trying to engage other advisers to drive TQoT, and there was a lack of interest / failure to engage / apathy etc. then he is perfectly entitled to voice his opinion on what he has so far experienced.

As you have, by your own admission, "never heard of it" perhaps you are less than qualified to comment, don't you think?

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david cubitt

Nov 12, 2012 at 08:42

likewise have not heard of this initiative but hats off to you Shane as we really do need to regain the publics trust. Unfortunately the noise being generated by those with self interest is drowning out smaller honest hard working IFAs which is why we have teamed up with Succession and likeminded IFAs to build a new model which is fit for purpose and can be trusted.

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Ross D

Nov 12, 2012 at 08:51

This is the problem; No 2 advisers agree with each other. A fairly innocuous article and within four comments, there is dissagreement and pointed comments. The industry can't come together in one voice when we can't agree on such a simple idea as this.

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Paul Barnard

Nov 12, 2012 at 09:10

@ Stevie Boy - I didn't say that he WASN'T entitled to voice his opinion, but you somehow feel qualified to tell me when I can voice mine, whilst hiding behind a nom de plume.

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Kate Brookes

Nov 12, 2012 at 09:22

Totally agree with Ross D. Can we just discuss one thing without it turning into a bun fight

@Stevie Boy

I had never heard of this either, and read Citywire on a daily basis.

Maybe if this has been met with apathy it is because of the all time low in morale in the industry. People have been loosing their jobs or getting out of the industry, those of us left have no real idea what it will look like after RDR, as it hasn't happened yet.

If recent surveys I have read here are to be believed, the general public won't be using us after RDR anyway as we will all be too expensive. The press is full of gloom and doom, and bad news is feasted on like Vultures feeding on the entrails of what ever is left of this industry, whilst we all bicker among ourselves.

Mr Mullins idea is laudable, and my advice to him is 'If at first you don't succeed try try again'. Don't just chuck in the towel, half of us had never heard about this, and would have been in full support had we done so. Maybe if well publicised it could do a job of bringing us all together and increasing morale?

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David Ingram

Nov 12, 2012 at 09:32

There was a fair bit of publicity on this, between citywire etc and the IFP. And the aim was, and still is, laudable and very worthwhile. I suspect, however, that timing has been an issue - with many firms/advisers having to concentrate fully on RDR preparation. The tunnel vision forced on advisers by the continual changes to RDR and the long debate over Independent or Restricted etc is probably responsible for many not having picked up on this initiative.

Shane, if you really have dropped this, please do pick it up again next year when vision may well have broadened out again.

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Anitaki

Nov 12, 2012 at 09:37

Getting a bunch of IFAs to agree on anything is like trying to herd cats, or butterflies.

They can't even agree on unregulatetd investment "opportunities", (see contemporaneous thread) irrespective of the obvious post-mortem on the horizon.

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Andrew Watts

Nov 12, 2012 at 09:39

Like Kate, never heard of it, but that may be because it wasn't supported by "leading members of the F S industry" - whoever they are?? I cannot believe people like Gill Cardy or Derek Bradley would not support something that was good for the "profession", so I'm sure there will be another side to this?

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Stevie Boy

Nov 12, 2012 at 09:41

No Paul, if you re-read my comment you will find that I did not tell you anything. I posed a similar question to you as you did to Shane.

I was querying the basis of your negative comment, that was all.

Steven Roth

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Anitaki

Nov 12, 2012 at 09:43

@ Andrew

Sometimes, people will only get on board the bus if they can sit in the driving seat

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Tim Page

Nov 12, 2012 at 09:44

I wonder if the fact that TQoT patnered with FT Adviser meant that other publications (like City Wire) did not give the initiative the oxygen of publicity it needed.

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Steve

Nov 12, 2012 at 09:48

Core to this has to be we all feel let down by the FSA and the FSCS. The first by its inability to prevent products coming to market that are clearly not appropriate the second by the additional financial burden put upon IFA's due to the failings of the 1st.

As I have stated many times before, let's have a system of regulated products that the FSA authorise and have a system of compensation to investors for bad choice of product by an IFA or something going seriously wrong with the product - but this is where the FSA need to work harder on checking the credentials of the product provider.

The second tier of investments are to be unregulated whereby the investor is not entitled to compensation for anything and investors become educated to know this. Regulated Good Unregulated Bad.

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Julian Stevens

Nov 12, 2012 at 09:48

I do recall the launch of this campaign but, like many other IFA's I suspect:-

1. what I don't recall is anything in the way of an itemised action plan, plus

2. Isn't one of the principal aims of the FSA's RDR to restore trust in financial services?

3. I'm too busy running my own little ship, getting qualified, coping with the mountains of regulatory bulletins from our network that arrive in my inbox every week,

4. documenting as compliantly as possible the few bits and pieces of new business that come my way in these straitened times (something like 40 pages for a combined ISA and Unit Trust that I wrote last week, what with all the risk assessments, illustrations and KFD's in addition to the 10 page suitability letter and as much again in various appendices). Plus

5. Did I really believe that such a campaign was ever likely to gain sufficient traction to make any appreciable difference? No I didn't.

All that matters to me is that my clients trust me, stay with me and hopefully recommend me to their friends, family and colleagues. What other firms do, if they can survive the relentless assault of regulatory levies and bureaucracy, is between them, their clients and the regulator.

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Anitaki

Nov 12, 2012 at 10:13

Also "Core to this" is that AIFA lunched whilst Rome burned.

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Bob Donaldson

Nov 12, 2012 at 10:20

I personally don't care about trust in our industry is all I care about is trust by my clients in me and my business.

If everyone dealt with their own backyard first then we wouldn't have the problems in the whole as an industry.

I suggest whilst Shane Mullins may have the good of the industry at heart, it has been the same since time began and this industry is unlikely to change in a hurry if at all. Perhaps the abolition of commision particularly on investment products will be a start.

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Philip Melville

Nov 12, 2012 at 11:06

Absolutely Bob, same attitude should prevail towards all aspects of our industry.

So easy to blame somebody or something else.

Times have changed and not because of the RDR but because our industry has failed to recognise that life is different now and people want to see value for their money.

There is a huge demand for advice amongst all sections of the community but new approaches are needed by everyone involved.

At least making advisers think about why a client should want to pay them for what they do is a good start and will go a long way towards getting people to at least trust advisers if not politicians and product providers.

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Julian Stevens

Nov 12, 2012 at 11:19

To Steve at 9.48 ~ The FSA will never bind itself to approving products. In the event of one of them going wrong, all the fingers of blame would be pointing towards E14, even though the PIA, I seem to recall, posted on its website that Split Cap Investment Trusts were low risk but then, in now time-honoured tradition, refused to admit having got it wrong and the costs of cleaning up the mess were dumped onto other parties.

The closest we'll get to product approval is the FCA blocking the marketing of anything that looks unsound with, of course, the caveat that just because it hasn't jumped on something that doesn't look kosher, that doesn't mean that it's okay, it just means that the FCA won't have spotted anything obviously defective about it or, if it has, it. hasn't yet got round to doing anything about it.

As always, the burden of due diligence (and pretty well everything else) lies with the seller of the product.

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Green Eyed Monster

Nov 12, 2012 at 11:31

I wonder if we are self flagellating again?

Shane expressed his disappointment in the lack of interest by some "leading members of the financial services industry" The clue is in the last word.

Shane was not criticising IFA firms, but product providers. banks etc.

We all know their customers are rapidly losing trust, so it is surprising they don't rise to the challenge of trying to restore some trust.

But IFA firms should not worry. As some bloggers have said above. As long as our clients trust us thats all that matters.

Let the product providers continue to lose trust. All it does is expand the contrast between the industry and the profession.

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Philip Melville

Nov 12, 2012 at 12:07

Lets be positive about change folks.

As everyone begins to get used to having to get their money from their clients then there will be an increasing reluctance by advisers to use any product which might put this new relationship at risk.

Why would you even think of using a product that you cannot fully understand and which might destroy the trust you have carefully built up with your client.

Of course initially this will probably mean taking safe vanilla options but over time providers will realise that if they want to get their products to market then they will have to make them do what it says on the tin.

We could eventually reach a situation where responsibility for the product is retained by the provider in return for an adviser using it with his clients.

Money will continue to talk and when the client's willingness to pay is in control then just maybe the rest of the industry will have to make equally dramatic changes to their operations similar to those made by the adviser community.

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Hickky

Nov 12, 2012 at 13:10

Trust between two parties is earned and not a campain. If it was easy, why don't the banks have a campain called 'Trust in us, we are on your side'. Why not? they would be laughed at!

The insurance companies who price their old pensions to make sure the biggest beneficiarys are themselves. Will the general public trust them? Not when told stories of a 20 year old pension that had 10K paid in in equities is now worth 11K. So no one really trusts them either.

Mind you I recently noticed one mutual was advertising their mutual status as a trust issue, and they are 'on your side'. If they were really on your side, they would lead the best buy tables almost everywhere, as shareholders do not need to be paid. Perhaps this firm is run for the benefit of the employees. Does this enhance trust?

The duty of the regulator is to maintain and enhance trust between the public and FS orginisations.

The most appropriate orginisation to do this is the SFA from thier plush new offices.

This starts with building a new huge jail and tasking the SFA to fill it with the FS individuals who have breached client and the public's trust.

The LIBOR manipulators, the CEOs who transformed the bank's attitudes, the promotors of Arch Cru, Landbanks, Ponzi schemes, Vietnamese green oil production etc. as well. All should be admitted who deserve it.

Then perhaps there would be no need for a campain!

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Steve

Nov 12, 2012 at 13:33

@ Hickky. This has already happened Hickky, its a big building in Canary Wharf, trouble is the inmates still are allowed to tell us what to do.

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Billy via mobile

Nov 12, 2012 at 14:03

Perhaps it's easier for him to create trust at bbc.

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Feargal

Nov 12, 2012 at 16:48

FT Adviser says :-

Mullins not giving up on Question of Trust

Shane Mullins has insisted he is not giving up on his campaign to restore trust in financial services, but is changing tack.

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gggggg hjhjkl;'

Nov 12, 2012 at 17:51

Maybe it is because a "percentage" of IFAs do not deserve greater trust, to the detriment of all!!!

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Ted via mobile

Nov 12, 2012 at 22:08

Is this the adviser who was at oak tree?

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Norman Engllish

Nov 16, 2012 at 19:49

Trying to get the IFAs to unite behind anything is difficult when we have all been trying to get ourselves ready for RDR. I apologise for not supporting, but to be honest its taking all my efforts just to keep on top of things in my small practice.

Please don't be disheartend, once we turn the year maybe we mighht have time to support such a stance.

Yes I am guilty as charged, yes I don't read enough and missed it.

>>>>>>>

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Ian Lees

Nov 17, 2012 at 09:30

The Industry of Insurance claims to be built on trust, although it appears that given the failures of Directors and Senior Management at all levels of insurance companies - Mutuals etc.,, who have now exppired or just gone insolvent - to be purchased by commercial money lenders -in the business of banking e.g Edinburgh based bank TSB purcahsing Halifax and Bonk of Scotland, the remnants of brand name scottish widows life assurance and clerical medical, guardian and equitable life also dissapeared into the ether of dutch insuer and insolvency respectively - how can anyone have any trust in financial institutions. In my days as a broker consultant in Fife for scottish widows - they tried six times to buy brokers, going down the route of giveing advice then pulling out - using their brokers sales consultants - to absorb their incompetence. Put simply, the incompetent running the incontinent .

The main ppoint is missed - a client who is purchasing products will purchase one product every six years. A salesperson who is flogging products will sell one product to their client - every six years - that is not a " profitable business model", which is why money lenders have been purchasing client banks - it is the old style of chucking as much manure at the wall - so that some of it will stick. The salespeople disenchanted with telesales - demotivated by the industry of insurance - abused by employers try to escape - look for a better life for themselves - control of their own destiny - building their own businesses - out of the clutches insurance companies - who fail to insure , managers who cannot sell - so go into mangement and cannot manage - who have absolutely no interest in their customers. Consumers are the old " yellow pages", consumers to be sold to - flogged products which are not fit for purpose eg endowments pensions PPI - they are a client bank - to be used and abused - and sold to . IFA's and tied agents - have built up and developed great client relationships - at the heart of their operation - which is costly. This relationship cannot be " sold ", cannot be "purchased" - becasue it is the heart of the matter. It is the basis for good quality business - repeat orders protection of the family - protection for their businesses - THIS IS TRUST - and the trust of ongoing advice. The government are hell bent on destroying the business realationship between IFA/Tied Agent and the consumer . This business relationship - is the only element in financial services - where TRUST exists . the destruction of insurance companies by the Directors force people - to move around - their policies churned or sold on to other advisers or insurance companies - to propel more sales in the most sinsiter destruction of consumers wealth. This is to help the death roll of insurance companies who have faield their customers - failed to deliver TRUST - failed to deliver policies which do what they say on the tin - or in the contract terms . More demotivation - more destruction - more quantitive easing - more changes to pensions with the on going failure and negligence of government - who lack knowledge and are more at home in the jungle - snoring and keeping the animals awake . Bring on Auto enrolment the " peoples pension ", or legalised churning by the FSA and its unborn child the FCA

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david mann

Nov 17, 2012 at 11:28

Get out of the bed on the wrong side this morning Ian? ;-)

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Ian Lees

Nov 17, 2012 at 17:25

@david Mann . . NO ! got out of the right side of bed - the one which is reality. Reality is . . . . the destruction of trust by product providrs against their clients - the destruction of trust when clients reduce their risk against loss - by purchasing any insurance product - and the loss of trust in a " regulaotr " who cannot regulate - yet gives the impression they are " protecting the public ", against rogue traders Equitable Life - Endowments - pensions and PPI. Everyone with experience in the industry of insurance knows full well . . .that insurance is based on Trust ( unlike banks - and those money lenders . . .engaged in the creation of debt - for their own purposes, including profiteering ). Consumers have been swindled - when Trust is lost - gone forever ! Why would anyone trust in an adviser or financial services company . . .who has betrayed their TRUST ? Advisers tied and independent have built up this trust - and they can " Save and Prosper ", with their clients interests uppermost - unfortunately this cannot be said for insurance companies who start products - make charges then opt out - or sell to another provider e.g estat e agents in the 70's and 80's purchased by insurance companies - who then sold them back at 1 penny . Going back to bed now - the same side I got out ! ? !

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