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Is it really any wonder that the introduction of the FSA’s burdensome treating customers fairly principles is actually having a negative impact on the service advisers are able to offer clients?

Lo and behold, several months on from the introduction of TCF and advisers are reporting that the burden of having to tick boxes and complete near insurmountable amounts of paperwork in a bid to demonstrate that they are in fact treating their customers fairly is meaning less real-life, face-to-face time with clients (Click for news story).

Shock horror! Yes, another ream of red tape is diverting people away from their real jobs.

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Yesterday Banco Santander announced what to some has been a long time coming.

The Spanish owner, which bought Abbey back in 2004, has increased its foothold in the UK market by acquiring struggling Alliance & Leicester and the savings book of Bradford & Bingley in the last 12 months.

While any acquisitions in other parts of the world have automatically adopted the Santander name, its UK subsidiaries were the exception to the rule – until now.

Yesterday António Horta-Osório, chief executive of Santander’s UK businesses, revealed that by the end of 2010 all three businesses will take on its parent’s moniker.

Let’s put this in perspective: under the name of Abbey Road & St John’s Wood Permanent Benefit Building Society, what is still popularly know in some circles as Abbey National, was founded in 1874.

Bradford & Bingley Building Society was formed in 1964 as a result of the merger of the Bradford Equitable Building Society and the Bingley Permanent Building Society, both of which were established in 1851.

Alliance & Leicester Building Society was created in 1985 through the merger of Leicester Building Society, which was formed in 1853 and the Alliance Society which saw its origins in 1875.

While mergers have always been an important part of the mutual world, it is apparent that despite this a lot of the time the individual organisations involved still retain part of their identity and rich heritage.

The UK financial sector has seen many casualties over the last 18 months, with some historic organisations being saved by the skin of their teeth and others disappearing into oblivion.

With Santander’s re-branding, it has effectively wiped out over 150 years of UK financial history in an instant.

In another 150 years will this be seen as one of the defining moments which effectively saw the death of the UK as a strong economic power?

Can we still maintain that we are a global financial hub? Or have we been reduced to a smaller cog in the machine?

Are we a lot more dependent on our European cousins than we would like to admit? And will we see more financial institutions seeking foreign investors?

QUESTION: I belong to a network, and my commission payments have been taking a long time to come through recently. Should I be worried, and how can I convince the network to speed up their payments?

ANSWER: In the current climate you are right to be extra vigilant when it comes to the speed of commission payments, as this could suggest possible cash flow issues at your network.

On the other hand, it might simply be a case of volumes slowing down payment processing or a one off glitch.

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Consumers with self-certification mortgages are telling the Financial Ombudsman Service that brokers encouraged them to inflate their income.

If somebody told you to lie on an application form, would you unquestioningly accept their advice and basically commit fraud?

Just because someone tells you to shoplift, would you walk into a shop, pick up some goods and disappear without paying?

Anyone who has a mortgage knows you are repeatedly told to check all the details on the application form to make sure they are an accurate account of your financial affairs.

While I am all for consumer protection, if complainants think they should get compensation because someone told them to cheat and lie and they did so then I do not think they should receive a penny.

If an adviser encouraged a client to lie, then the regulator should investigate their affairs and potentially ban them from ever offering mortgage advice again.

But if the consumer knowingly told tall tales in a bid to get more cash than they could afford to pay back, then their actions should not go unpunished and their statement should be referred to the police.

As I sit here at my desk writing about the financial news of the day, I can’t seem to get a nagging thought out of my mind.

That thought is about moving out of my dingy rented flat in South London and into a property of my own.

I had bet with myself that by the time I turn 30 – only 15 months away – that I would finally become a homeowner. By that time, I estimated that prices would have reached their bottom and stayed there for a while and I’d have a sizeable deposit. Read More »

It appears all hope for the intermediary market is not lost, if a recent customer agreed remuneration (CAR) pilot study by AWD Chase de Vere is any indication.

As we reported earlier in the week, AWD claims that savers and investors DO understand the value of personal finance advice and ARE willing to pay to receive it.

If fact, they said that nearly seven out of 10 (or 68 per cent to be exact) clients on the trial opted for CAR.

Impressive stuff – but the market is understandably cautious about welcoming any such ‘proof’ that the RDR’s recurring income model will not bring about the end of the industry.

In principle CAR does sound like the perfect arrangement. After all, the client knows up front how much they will be stung for, with the added bonus of being able to decide whether to be invoiced separately for their fees or paying by a deduction from commission payments.

The problem, as with so many things in life, is that while they sound good, the question remains whether anyone is actually willing to front up with the cash?

According to you, it is anyone’s guess. At last check, a straw poll on FTAdviser’s homepage showed the market to be evenly split on the topic.

But given that new data from Plimsoll has shown that as many as 363 financial adviser firms have seen their sales decline by as much as 19 per cent in the last year, maybe radical change is exactly what the industry needs.

With the exception of perhaps traffic wardens and bureaucrats it is normal human nature to be antipathetic to rules and regulations. However, in a civilised society rules and regulations are very often indispensable.

For those who are regulated, irksome as it may be, logic, fairness and at least some positive discernible results from the impost of the rules are at least some compensation.

Over the past decade or so this unfortunately has been far from the case and I speak not only of financial services. Read More »

QUESTION: We are keen to look into training and development schemes for our employees – helping them to really make the most of the technology we use. Ideally, we want to both improve staff confidence and ensure we obtain the best possible results from our systems to enhance efficiency and service. What is the best way for us to proceed?

ANSWER: There have been a growing number of nationals and networks who have launched support plans and services aimed at professional development; paying for, incentivising and providing in house support for members to further their skills and qualifications. For many smaller, directly regulated firms however, there is still one area that often gets overlooked when it comes to training and that is technology. Read More »

At last something positive to come out of Lloyds Banking Group. The bank, now heavily owned by the taxpayer, is trying hard to help people get onto the housing ladder.

It has launched a mortgage which could offer up to 95 per cent of the property’s value, for a first-time buyer, as long as the buyer’s parents put aside some cash in a Lloyds account.

The deal itself is quite interesting – a rate of 4.39 per cent, fixed for three years.
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As an adviser you will have heard about how the welfare reform changes introduced last year provided further opportunities for you to sell income protection to your clients.

But what could these changes actually mean to them?

Well, if your client were earning, for example, £30,000 a year then they would experience the equivalent to an 79 per cent drop in their earnings each month if they were eligible for, and had to rely on, incapacity benefit from the government. If they were earning up to £70,000 a year it would be the equivalent to a 91 per cent drop in their earnings. Read More »

During the credit crunch, even a Bank Holiday weekend can be hard work.

According to Abbey for Intermediaries since the economy went more bust than boom, a growing number of mortgage advisers have decided even the God’s day of rest is no longer sacred from the demands of financial services.

The lender reported the busiest times at a weekend for advisers logging on to its website were traditionally Saturdays, with an average of 1,000 brokers checking online daily, while more than 300 brokers tend to log on during Sunday.

Even bank holidays do not offer any respite with Abbey for Intermediaries finding more than 2,000 intermediaries accessed their website during this year’s Easter weekend, while 500 signed in for online business during the first May bank holiday weekend.

This is depressing but unsurprising stuff. After such a rollercoaster 18 months few advisers are willing to wait a whole two days before taking the temperature of lenders or making sure the deal they recommended on a Friday will still be there on a Monday.

Perhaps it is time lenders gave advisers a break and left the deals they offered on a Friday untouched until at least the following Tuesday.

Another day, another dollar. Isn’t that how the saying goes? But with the recent turmoil and redundancies across the financial services sector, perhaps it should be changed to another day, no more dollar.

Yes, Lloyds Banking Group has been at it again and today announced a further round of job cuts – 625 to be precise. Read More »

Many, many moons ago I addressed a meeting of IFAs and insurance company reps (as they were in those days) during which I criticised many of those present for using the letters ALIA and FLIA after their names.

Sounds grand, doesn’t it, but in fact those designatory letters signified very little. For those of you who’ve forgotten, or never knew anyway, ALIA stood for Associate of the Life Insurance Association and meant that that the holder had been a member of the LIA for five years and had relevant industry experience; FLIA was the same, but applied after 10 years.

The point I made at the talk was that advisers/reps using these letters were conveying a false impression to clients that the holders were better qualified than was actually the case, and they should cease immediately.

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Product Adviser Interactive has been integrated into the news pages of FTAdviser.com.

You can now read about even more of the latest mortgage, pension, investment and protection deals online.

Meanwhile, to air your opinion on the latest launches, email your verdict to fa.newsdesk@ft.com.

The best comments will then be featured in the print edition of Financial Adviser.

This heated debate about professionalism and qualifications has certainly got the industry riled-up.

Yes, the RDR is a big deal – that’s a given. Yes, advisers should act in an ethical manner and put their clients’ interests at the forefront of decision-making – obviously. But aren’t we all being fooled by a stinker of a red herring courtesy of the FSA?

I mean, it was the regulator that introduced depolarisation and invented the different categories of tied, multi-tied and independent adviser – titles the RDR has further tried to tinker with. Yet, it is such title-tinkering that so confounds consumers.

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For some years I and many others have contended that any distinction between advice and sales is futile.

Most consumer problems are relatively simple and easily resolved by the use of products such as pensions and protection insurances which have been designed for these specific purposes. If we accept this then we must perforce accept that providing the advice in itself does not solve the consumer’s problem.

Arranging the purchase of the relevant product is what actually solves the problem, so advice without a sale is pointless. Equally, a sale without advice may also be pointless as it assumes that consumers know what they are doing. Read More »

The time has come for the New Puritan to hang up his pointy hat in anticipation of an imminent departure to join the Financial Times.

Yet, it has been an interesting time in which to raise issues of morality.

Each day brings further tales of MPs fiddling – which, frankly, is what they’re doing – their expenses; while The Telegraph’s attempt to steal the high moral march on their competitors is slightly tarnished by questions over how they actually came to have the information in the first place.

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At the very commanding heights of British society something has gone seriously wrong.

If we can dismiss the subprime crisis and what followed as misjudgements, even if serious ones, then the issues of huge bonuses for failure and the outright defrauding of taxpayers by members of parliament have moved us in to another league.

The truth is that this generation of parliamentarians, more so than any other post-war generation, has lost its moral authority, they no longer have a right to tell the rest of us what is right from wrong.

How can they tell the unemployed that to draw the dole and work cash-in-hand is wrong when they are doing the same, but only on a bigger scale?

How can they talk of Sir Fred Godwin having his snout in the trough when he is doing so in a private trough and at least has a contract to fall back on?

Or, how can they tell Independent Financial Advisers that they are commission obsessed rather than customer-focused when at least some of them are digging deep in to the taxpayers’ pockets to claim for second homes that are anything but?

It is not an oversight to claim for a mortgage for a second home when no mortgage exists? That is outright dishonesty.

Then to hide behind the rules adds to that basic dishonesty. How often do we hear the claim that some wrong-doing was within the rules? Rules are social constructs, if you create rules bright people spend an inordinate amount of time trying to get round them.

But even in this secular age we all know when an act is wrong – from acts of violence to theft. One does not need a sub-clause in a parliamentary code of conduct to tell us that if we bought a bathrobe then that we should not claim on parliamentary expenses.

Ordinary people look to our social, business, religious and political leaders to set examples, not to hide behind the superficiality of human rights and cultural exclusivity.

People who aspire to lead must first arm themselves with a moral compass to provide a roadmap to what is and is not acceptable behaviour – especially in public office.

Politicians appeal to us to trust them, but how can we when we do not know if they are just being economical with the truth or being outright liars.

How do we know if there are weapons of mass destructions, legitimate expenses or just fraudulent claims? Trust us, they say. But how can we.

Of course, we must be careful not to tar all of parliament with the same brush. The House of Lords is a far more ethical institution that the lower House.

In all this mess, putting aside the mess in sections of the mortgage advisory sector, the IFA community can hold its head up as bastions of integrity in a cesspit of moral decay.

The day started politely enough with Lord Turner, chairman of the FSA, reassuring the mortgage industry that it would not rush into binding advisers and lenders with any new red tape.

By the end we had blood curdling screams, accusations and threats of big brother watching over you all. Welcome to the mortgage industry in 2009.

The day started gently enough with Lord Turner kicking off proceedings saying: “We do not face today, nor are we likely to face anytime soon, the danger of irrationally exuberant behaviour by either borrowers or lenders.”

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Aviva has decided to grow its in-house adviser channel as the implementation of the Retail Distribution Review looms.

According to the insurer, there is the potential for it to access 1.4 million more consumers who have an interest in financial products and services but do not currently have an active adviser.

This is also a market it sees as potentially growing larger, if the RDR pushes advisers out of the industry as expected. Read More »

Zurich has launched an offshore bond, entitled the International Portfolio Bond (IPB), aimed at high net worth UK residents.

KEY FACTS:

- The product is underwritten by Zurich’s Irish business

- The bond is provided from, and will be administered in, Dublin and will be passported initially into the UK, with the potential to launch later into other countries.

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For young advisers, the prospect of giving financial advice to clients who are used to the faceless banks or the hopeless old-school adviser is a daunting one.

I joined the Chester Partnership back office team a few years ago, at first just for a job. The financial services industry was certainly not one I had considered: it has not got a strong reputation in the media, especially now.

But I soon discovered a career that I could really enjoy. I had the privilege of being able to watch the IFAs at Chester Partnership and gain their experience on the various products, styles and techniques for providing sound advice – as well as pick up the occasional pointer on how not to do it.

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Is that it for the offshore centres?

President Barack Obama’s latest publicity-friendly swoop on offshore tax havens has garnered praise and criticism in equal measure.

Is he really Robin Hood? (Although in this case, surely, he’s taking from the rich corporations to give to the corporations that used to be rich.)

Or is he some latter-day socialist hell-bent on redistributing wealth more equitably? Read More »

QUESTION: The recession has led to a downturn in business for my company. I employ a small number of staff and do not want to have to let anyone go. Are there any alternatives that I can consider before looking at redundancy?

ANSWER: There are indeed a few alternatives to look at before redundancy and many employers are now turning towards these options as a way of retaining key members of staff while at the same time keeping their business afloat.

Staff wages represent the highest cost to a business so looking at this area is a good place to start cutting costs. Implementing pay freezes or even pay cuts where necessary will save your company a significant amount of money and still allow you to keep your existing workforce.

As well as looking at your employees’ base pay, you should also re-assess any bonus schemes that you have within your business. Bonuses are not generally a statutory contractual right and therefore you should look at either decreasing bonuses or removing them altogether.

As well as looking into the possibility of cutting bonuses, you should also remove any overtime. If you have to look at the redundancy then this would suggest you do not have enough work to justify this additional expense.

Depending on how dire the financial situation is, there is the possibility of turning towards a pay deferral scheme. These schemes are an agreement between yourself and your employee whereby there is a temporary deferral in pay that is paid to an employee at a later date. This is quite a complex option, however, and you should seek professional advice before deciding to use it.

Implementing a flexible working system in your business may be an ideal choice for both you and your employees. While the employee can enjoy a better work/life balance and feel a little more in control of their working pattern, as an employer you can benefit from the new working patterns.

For example, many businesses would like to be able to operate a little later into the night or even open on a day where they would otherwise be closed. Having a flexible working system in place would allow this to happen while at the same time adding no additional cost to the business.

Is the downturn in business only affecting one area of your business? If so, you may want to assess the possibility of redeploying your resources from one area to another in order to keep business running smoothly.

The day-to-day running of your business will also involve a lot of controllable costs that you may not have thought about. Assess the way in which you perform different processes in your business and look for a more cost-efficient way of doing it.

There are other alternatives available to a business and these should be looked at before you decide to make redundancies to your workforce. You should look carefully at any alternative option you decide to use to ensure that it is genuinely beneficial to your business.

Peter Done is managing director of Peninsula

Barclays Wealth is reissuing its Super Tracker with a new additional option for investors seeking to accelerate future gains from the US stock market.

KEY FACTS:

* Launching on 9 May, the Super Tracker is a three or five-year investment offering geared exposure to the FTSE 100 or – as from this issue of the five-year version – the S&P 500 index.

* The S&P option, which has been introduced following a recent BW survey, which revealed strong IFA interest for a US-linked protected investment, offers four times the first 22.5 per cent increase in the S&P 500, subject to a maximum return of 90 per cent.

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