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Sifa opens membership to ‘restricted whole of market’ advisers

by Daniel Grote on Jan 02, 2013 at 08:11

Sifa opens membership to ‘restricted whole of market’ advisers

Sifa has said it will allow membership to ‘restricted whole of market’ advisers following the Financial Services Authority’s (FSA) changes to its independence criteria under the retail distribution review.

The FSA has moved from a definition based on the lack of a ties to a third party to one focused on the scope of services offered by a firm.

Sifa, headed by chairman Ian Muirhead (pictured) has previously only allowed membership to independent advisers under the FSA’s previous definition. But it said that basing membership criteria on the new FSA definition  would have excluded some firms ‘which are independent in the dictionary sense of the word of being free from the influence of third parties’.

‘Freedom from third party influence is the essence of independence as understood in the legal profession (and indeed everywhere outside the financial services industry) and this will continue to be the basis for determining eligibility for Sifa membership and for inclusion in Sifa’s Law Society endorsed Directory of Professional Financial Advisers,’ it said.

‘This means that Sifa will be welcoming membership applications from "restricted whole of market" advisers.’

13 comments so far. Why not have your say?

Gillian Cardy

Jan 02, 2013 at 09:33

Can someone remind me : what is S.I.F.A. is short for ... ??

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ian muirhead

Jan 02, 2013 at 09:43

Gill

Hitherto, SIFA has stood for Solicitors Independent Financial Advice. Now it stands for Supporting Impartial Financial Advice.

Best wishes for 2013

Ian Muirhead

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Simon Kershaw

Jan 02, 2013 at 09:57

Ian,

Given that you require advisors to be free from third party influence can we therefore have your assurance that direct saleforces will not be ushered into the fold?

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ian muirhead

Jan 02, 2013 at 10:08

Simon

Absolutely! Tied and multi-tied will continue to be excluded from the fold.

Ian Muirhead

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Christopher Petrie

Jan 02, 2013 at 10:35

@ Ian

As you know, there is some suspicion that a certain "upmarket tied sales force" is rather inclined to be slightly less than clear about their status when talking to lawyers and asking for referrals. As a result, some lawyers have referred clients to tied agents in the mis-belief that they are passing them to IFAs.

Given this, and the new changes in SIFA practice, wouldn't it be opportune for SIFA to explain the differences to lawyers by way of a working example...perhaps even naming such organisations that should NOT be receiving referrals and explaining why they don't meet the Whole of Market criteria?

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Simon Kershaw

Jan 02, 2013 at 10:39

Ian

Excellent. All we need now is for the SRA and the Law Society to agree.

Why do I get the feeling that SJP are laughing.

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ian muirhead

Jan 02, 2013 at 10:53

Christopher

Thanks for the comment. We're on the case! The marketing material which we are producing for our member firms to give to their solicitor connections contains the following statement:

"The overriding requirement is that referrals should be in the best interests of clients. In this respect, a Law Society Gazette article of July 2012 posed the question “In what possible regard will it be to the client’s advantage to be referred to an adviser with an ulterior motive? An adviser, lest we forget, who benefits from willfully ignoring any product that does not line their own pocket.”

Solicitors who are approached by financial advisers should therefore ask “Are you or the company you represent contracted to sell the products of one or more product providers?” However, it is important to be aware that some advisers who work for product providers are in denial as to their true status."

Ian Muirhead

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ian muirhead

Jan 02, 2013 at 10:58

Simon

The Law Society is rightly seeking to maintain professional standards, whereas the SRA is simply following the lead of the FSA, the senior regulator, which has given up on independence. Long may they differ!

Ian

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PHILIP EDWARD

Jan 02, 2013 at 14:10

Could it be that you are allowing restricted advisers into your association because SimplyBiz have set up a restricted arm.

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ian muirhead

Jan 02, 2013 at 14:23

Philip

No. We decided on this course even before we learnt of SimplyBiz's plans to set up a restricted arm. We are simply staying true to the principle of independence as understood by solicitors and applied within the profession.

Ian

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Giuseppe Iannelli

Jan 02, 2013 at 20:40

Ian,

Reading through some of the comments, I just wanted to share my thoughts.

"SIFA has stood for Solicitors Independent Financial Advice. Now it stands for Supporting Impartial Financial Advice."

I've not seen "Impartial" as an adviser status defined by the FSA, It's either Independent or Restricted.

"The principle of independence as understood by solicitors and applied within the profession"

Can't wait to hear a legal professional describing the status of their preferred financial adviser firm to their clients.

I'm all for supporting other professions so wish you all the best with your new directory.

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Eugen

Jan 02, 2013 at 22:23

Ian

I believe that the FSA has got the definition of independence better this time.

What counts are not the ties but what the adviser actualy does. There are ties that sometimes are hard to prove, as an advisory firm falling in love with a platform or wrap that offers tools for free, paraplanning for free etc.

You can't be a whole of the market adviser without doing a comprehensive and fair analysis of the relevant market, based on an unbiased and unrestrictive research. You can only be a whole of the 'half market' without doing that so the concept of restricted adviser, whole of the market adviser doesn't exist.

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Ian Lees

Apr 30, 2013 at 15:18

Restricted advisers and Leg Ends - what is the world of finanical advice coming to ? I had a convesation with a " Senior Compliance Officer -of a National ( who will remain anonomous ) - who confirmed I could not advise a clinet to pay more money into his or her pension scheme as " this was deemed to be advice - and therfore outlawed by the Finacial Conduit Authority " ( where everything goes down the pan ! I suppose I cannot like Mr Martin Lewis advise clients to invest and lose money in a cash ISA ? I would certianly not recomend the packaged products Lewis is sponsored for advertising . But this has gone beyond absurd - my local publican tols me I should get a pension - is that advice ? is it restricted or will he be locked up - or given thirty lashes ( I think he might enjoy the latter as a Man U supporter ) . Even Lois square arse can take a bite out of a fottballers arm . . and get a wee ban for a few games. I would normally say at thsi point the country has gone to the dogs - but it appears they are the only animals left that have not been put in tescos claims of " beef " burgers. I wont tell you what is in sweedish meatballs - but they are the dogs bollocks .

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