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Provider payments scrutiny better late than never

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Provider payments scrutiny better late than never

In his two years with the regulator, Nick Poyntz-Wright can already lay claim to an impressive body of work. Annuity pricing and the management of unit-linked funds have come under scrutiny during the ex-Skandia boss’s time at the Financial Conduct Authority (FCA), latterly in the role of long-term savings and pensions supervision director.

Last week we saw the results of his focus on provider payments to advisers, with a review of 80 deals showing more than half contravened the objectives of the retail distribution review (RDR).

It could be argued that these three issues are areas the FCA should have focused on a long time ago. As for its crackdown on provider payments, one obvious response, and one that was voiced on our blogs, is: why now?

That is one way of looking at it. The FCA has pointed to an upsurge in such deals, such as where providers funded adviser support services, in the run-up to the RDR as its call to action.

And it is only with the policy weight of the RDR behind it that the FCA has been fully equipped to tackle it. With the RDR’s objective of eliminating provider bias, the regulator is now emboldened to remove it wherever it occurs.

Just because the FCA has started to tackle the issue a little later than some would have wanted does not mean it is not doing the right thing.

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