Retail Distribution Review

Written evidence submitted by Charmian Asher , Charmian Asher Financial Services

I have worked in the financial services industry since 1988 and started my own sole trader firm as an independent financial adviser in 2004.

I put the work in to attain the CII’s Advanced Financial Certificate in 1992.

I have a very loyal client bank, most of which have been with my throughout my working life.

I plan to retire in 2014 at the age of 69 when I complete an agreement to look after clients of a retired  colleague.

I am now being asked to gap fill 132 subjects or, alternatively, take 6 exams at a cost of at least £900 not to mention the working time which will have to be assigned to studying to allow me to stay in the industry for a term of less than 2 years,

I think the majority of IFAs are in agreement with the drive to a higher level of professionalism – there are always those who will be satisfied with the lowest level of certification in any industry.   However, this hell-bent drive to get every IFA  to a level 4 qualification is ill considered and detrimental, in the short term, to the people who are the most important factor in this – our clients. If I have to spend a considerable amount of time in gap filling or taking exams, I will not be able to spend that time looking after my clients which is my main objective.

If |I come across a case that needs research in order to give what I consider to be the best  advice, I automatically put in the work to ensure that I am up to date with all the information needed  to be able to discuss the options with my client. Most of this has not been documented formally but carried out in the process of giving best advice.

In other industries, when a higher level of qualification has been desired, it is the new entrants who are requested to attain this, not the seasoned professionals.   Perhaps a solution would be to allow grandfathering of those who are within 5 years of retirement – provided they have been practicing  for at least 20 years.

I have worked on a very open basis with my clients on a commission basis although they know they have the option of paying a f ee should they wish to do so.   They do not wish to do so!   The answer to this problem is to limit the commission payable to IFAs to 3% initial and 0.5% trail on ALL products.   This would mean that when an IFA was called on to provide specialist advice on complicated cases, it would be necessary to agree a fee with the client to reflect the additional work which would be necessary in such cases.

The objectives of RDR are achievable with far less force than is presently envisaged by the FSA.  

January 2011