Ken’s independent standard

I was at a lunch hosted by Simply Biz’s Ken Davy last Thursday where he placed the flag, nay, the standard in the ground for unbiased, unrestricted, independent financial advice.

I realise obviously the Money Debate is being er, fifth with the news, if it’s lucky, but we will try to offer intelligent analysis while suggesting that our staff (of one, me) have been quite busy. But there is more to this than simply Ken taking up the cudgels and bopping the nearest network boss over the head.

He says the difficulties of being independent are being overplayed in what he clearly feels is a network push to tie up advisers. Restricted is just the new name for tied or multi-tied he thinks. That is bad for consumers and these tied operations won’t be acting on their behalf.  

The crucial part, however, is that Simply Biz says its offering will combine meeting the RDR definition of independence with providing the tools to make sure advice is suitable, something the FSA is very concerned about.

He suggests that those who say restricted advice can be more compliant and suitable are siren voices.

Now I don’t necessarily believe that this applies to the big concerns that are more asset gathering machines with advisers attached, who may restrict themselves and their clients. If you’re offering one big oeic albeit with sub funds, then there may not be much else you can do for regulatory purposes.

But there are two groups who maybe should look at what Ken is saying.

First are network members. If you are offered something ‘you cannot refuse’ by your network to join its new tie up you would be perfectly within your rights to ask ‘If Simply Biz can support independence why can’t you?’ If the answer is ‘we don’t think Simply Biz can do this”, ask them to say how it can’t in detail.

The second group may be some new model operations. They may deploy arguments to say ‘well, we are chartered so the independent label does not mean so much.’ But that doesn’t mean they should necessarily go restricted if they don’t need to. Some of the criticisms of DFMs and DIFs could also give pause for thought too about how all this fits together before 2012/13. Obviously these operations aren’t trying to lure themselves into multi-tying but maybe being independent is more valuable than they thought.

I have got a little bit sense that some people are saying to themselves ‘Well Ken would say that wouldn’t he?’ I suggest you pay a little bit more attention to what he’s doing and what he’s offering before making up your mind.

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One Response to “Ken’s independent standard”

  1. avatar tom baigrie says:

    Go Ken! I think restricted advice is for businesspeople who put profit before customers. That’s legal and normal and good business. Independent advice is for those who put customers first and then seek to make some profit as they fairly can. That’s what professionals do. Baigrie Davies LifeSearch plc (MM IFA of the Year dont you know!) will remain independant in RDR terms. So should all other professionals, for in the end we will beat the businessmen!