Regulator stands firm on platform cash rebate ban

In other words: F*** you lot, this is the way it's going to be whether you like it or not and there's nothing you or anybody else can do about it.

So the FSA has concluded that further research is needed to ensure that the implications for consumers are fully understood before proposing new rules.'

BUT it has yet to make rules to introduce the ban.

I've never seen a more incompetent bunch of half-wits... PLEASE FSA just make a decision and provide some clear guidance!! If YOU need more time, SO DO THE PRODUCT PROVIDERS AND OTHER INDUSTRY PARTICIPANTS!!

What a joke.

‘We do not want to see a situation develop where advisers set their charge dependent on what rebate is available to be paid into the client’s cash account, from which the adviser will then take their charge as we feel this would undermine the objectives of the retail distribution review.’

What a lot of tosh!

I challenge the FSA to produce any hard evidence of adviser charges having been set on this basis. It's almosty akin to saying "ban using knives at meals as we don't want to see a situation developing where we all turn into murderers" unbelievable.

Is there anyone with a brain cell in the FSA? A collection of highly paid, holier than thou dimwits.

I have just read the section of the report on rebates and it is clear the FSA looked very poorly on a lot of IFA responses around 'needing cash rebates to pay for adviser charges'. (FSA aren’t the only half-wits).

If clarity is the objective then ban all rebates, separate charges for the advice, platform and investment. I’m sure we can all live with that.

Chances are thought it’s likely the consumer will pay more if existing explicit platforms are anything to go by!

What a shame we have no closure on this yet.

Procrastination is the enemy of progress and it looks like The FSA is guilty of this right now. I would rather a firm decision than no decision at all!

Great point Miles John, I have just completed a heavily diversified portfolio and ofcourse I am going to charge each segment of the 28 funds the same as the rebate they get... what a crazy thought.

Anyway as the FSA want from RDR, IFAs will have (as most have anyway) a published fee structure irrespective of the rebates.

What will happen will be that the FSA saves face, sticks to their points and then the new FSA/PIA/Lautro comes in and saves the day saying hey we have listened to you guys and we are going to make changes....aren't we great!!

Look if you have a body that says screw you to the MPs of the land then I doubt they will listen to the troops on the ground...let them get on with it and they can die on their own sword!!!!

Sledgehammers to crack nuts?

Perhaps the FSA would like to articulate their reasons for thinking that it is so necessary to ban any form of fund rebate, even to the client. Banning payments from fund to provider is understandable (will this apply to life companies too?) but rebate to client??

What can be so bad for the client about getting a better deal by returning money to the client that it deserves banning? I think we should be told. No compelling reason has been put forward in any of the previous RDR documents. Even this one only mentions the potential to disguise the adviser charge - which is a disclosure problem so fix the disclosure rules - and a claim of potential product bias. Some bias is inevitable - is this one so serious it requires the huge cost (with commensurate impact on charges) of a complete change of a successful business model for the whole wrap industry?

This is an example of the worst kind of throwing out the baby with the bath water.

By the way, what is the expression for a double U turn (on rebates to providers) - there must be one.

Seriously, you just can't write commedy this good.

The problem is though, that this isn't some comedy sketch show this is the livelyhood and well being of thousands of advisers and the welfare of hundreds of thousands of clients which is at stake.

How can this farce continue?

Vive la revolution!

@ Stanley - a double U turn is surely coming full circle.

You couldn't make it up, could you.

Bungling on a truly industrial scale.

Policymakers with the intellect of woodlice, but the power of Stalin.

How can the FSA say "that it would be desirable, in principle, to ban both cash rebates from product providers to investors and product provider payments to platforms." on one hand and say they need further research and consultation to assess any unintended consequences.

It seems apparent that the FSA do not understand the impact of banning cash rebates will have on the industry.

More Cost, that will be passed onto clients!

Can someone please explain what a cash rebate is?

Is it an ifa/client inducement to take out a particular investment or a powerful tool for fund providers to increase the value of the ifa's bank or client's investment pot?

Not having a pop, just do not understand why it is such an issue. Granted, I cannot see why the FSA would frown upon it being rebated to the client fund!!

How is a coalition of Conservative and Liberals allowing this creature of the nanny state New Labour government to continue micro-managing every aspect of our business. Little wonder that its costs escalate daily whilst investor protection lags woefully behind (Arch Cru/Keydata charades - not me Gov and can't blame Capita they were big style supporters of New Labour).

Come on you clowns in Canary Wharf - what exactly will investors gain from this?