After the Solicitors Regulation Authority’s (SRA) belated and seemingly inevitable announcement that it would allow solicitors to refer to restricted advisers, does any value still lie in independent status?
With accountants having taken a similar stance on referrals, it seems the business case for remaining an IFA has waned. What then is left to engender loyalty to the IFA brand? Is it merely, as some have suggested, an irrational, emotional attachment to the name among advisers?
Well, no. As Sifa’s Ian Muirhead argues in his analysis of the SRA’s decision, the notion of independence still resonates with the public no matter how the term is defined by any regulator. The public understands it in its most straightforward sense: freedom to do what is best for the client’s interest, without constraints imposed by any third party.
It’s heartening to see that many members of the legal profession share advisers’ commitment to independence, even if its regulator doesn’t. And while the Law Society’s concerns about restricted referrals weren’t enough to change the mind of the SRA before it issued its verdict it could rally commitment to independence in spite of the ruling.
Concerns that the retail distribution review’s independence requirements are too onerous have largely been voiced by those with a vested interest in restricted advice, while the regulator itself has consistently emphasised how attainable the new standards are. Next year will not bring a decimation of the independent sector; but the perception that it will is being used to drive a land-grab by those who have never met the standard.