Is it all still ‘Pete Tong’ at the FOS in 2018?

Since 2011 we have been conducting research via a simple survey to gauge what advisers think about service levels and standards delivered by the FOS, in particular looking at their processes and the fairness of the system.

The first survey ran in 2011, then 2014 and finally, our last was in 2016, with the same questions.

A particularly disturbing trend was the increase of firms who had experienced false or manufactured accusations from complainants in an attempt to gain compensation, which went up from an already large 64% in 2011 to 74% in 2014.  

2016 continued to show a consistent negativity of experience.

So, what does 2018 look like?

Another two years have passed, and we want to know, will 2018 see any improvement on the:

  • 71% of advisers that felt FOS adjudications are unfair?
  • 69% of advisers that felt adjudicators help create complaints where no complaint existed?
  • 85% of advisers that felt FOS rules place an adviser or firm in a ‘guilty until proven innocent’ position from outset?

FOS Review

Channel 4 ‘Dispatches’ itself tackled the FOS earlier this year, painting a rather bleak picture of operations. As a result of the programme, FOS Boss Caroline Wayman has launched a review so it could “better understand and address the concerns” raised by Dispatches. This will be reported to Parliament shortly before summer recess.

Hopefully our survey, which will be shared with the FOS and Nicky Morgan (Chair of the TSC), will prove timely, and for Ms. Wayman provide a view of the FOS from an adviser perspective. And the industry itself can ponder if things have got better or not since 2011, 2014 and 2016.

Please complete the anonymous, 5-minute survey below and share it with your colleagues.

Your input is important, vital and greatly appreciated.

Surely still not Pete Tong at the FOS?

15 Mar 2016

Surely still not Pete Tong at the FOS?

The Financial Advice Market Review (FAMR), just published, says that The Financial Ombudsman Service (FOS) “has a crucial role in ensuring redress for consumers, and building confidence in the financial services sector, providing a quicker, easier alternative to the courts”.

The FAMR’s view on the role of the FOS was “that an effective financial advice market depends on consumers having access to a fair, objective means of resolving disputes with firms” but noted that the review highlighted concerns “about some aspects of how the Financial Ombudsman Service operates”.

With this observation ringing loudly in the ears of financial advisers, the findings of our latest FOS survey may, we hope, act as a source of constructive criticism. According to our latest survey all is not well at all at the FOS.

The results will be shared with HM Treasury, the TSC, FOS and the FCA.

Once again we find that:

  • an overwhelming majority see that in 2015, FOS adjudications are unfair- 71%.
  • Adjudicators actually help create complaints where no complaint existed- 69%
  • FOS rules place an adviser or firm in a ‘guilty until you prove your innocence’ position from outset- 85%.

Download our free survey now, complete with comments.

2015 is as consistent as our previous years findings from 2011 onwards. It is the hundreds of heartfelt comments that really tell the story.

The publication of the FAMR report sees a number of recommendations published, numbers 22, 23, 25 and 26 in fact.

It will be interesting to see if they are acted upon in 2016, I am sure our 2017 investigations will assist in that discovery.

FCA, asleep at the wheel or just showing off

Will the removal of trail commission have a negative effect upon your business?

If our current snap shot poll is correct, as at 10.30pm on 8th October 93% of the hundreds that have responded say it will be catastrophic.

This poll has not seen much publicity yet.

Logic must tell anyone with any degree of intelligence that whatever the rights and wrongs of removal are, the destruction by retrospection of a huge chunk of intermediated distribution revenue and value is neither right, fair or reasonable.

 And if this is the outcome, it is not good for consumers either.

How will it affect your business, will it destroy your business? Is the FCA aware, are politicians aware, do they care?

The poll link is here, let us know and see for yourself you’re your peers are saying.

Only yesterday we hear FCA chairman John Griffith-Jones saying ” “Yes, there may be side effects or unintended consequences and over the coming months we at the FCA will monitor developments in the market extremely closely. In particular we are alert to the advice gap issue and actually very interested to see where you, as part of a very competitive market place, go for new solutions that might meet the advice gap customer needs.”
Many of the unintended consequences (and this is one of them) as Griffith-Jones put’s it, were quite avoidable and were in many cases forewarned consequences. Now would be a good time for some meaningful listening and learning on the part of the regulator to avoid, not an advice gap, but an advice chasm.

As with almost every significant well intended aspect of UK regulation over the years, this may well prove to be an avoidable catastrophe from start to finish, with nobody left to man the lifeboats in the dash for the safety of shore.

Hopefully, I am wrong and somebody on the bridge at Canary Wharf will be able to turn hard a’port before the rocks are hit?

Segmentation matters. Fewer advisers than expected will only focus on most profitable clients.

Initial results in from our latest RDR survey reveal a lot has changed to adviser business plans in the last 6 months.

Fewer intermediaries now claim they will focus only on their most profitable clients.  At the same time the proportion of IFAs who have segmented their client base, in order to target differentiated services based on affordability, has increased nearly two-fold since November 2012.

Some interesting snippets so far suggest that:

  • 72% have completed or are in the process of segmenting their client base
  • 13% agree they will focus only on their most profitable clients (down from 23%)

For those of you who haven’t already taken part, please complete this important industry survey, in return we will provide you with a digest report of the results, which will let you know how other IFAs are changing their businesses post-RDR.

Please be patient, persevere, the end result will be worthwhile.

Click this link to access the survey.

Your help is both vital and appreciated.


Captain Blackadder definitely did not shoot this delicious plump-breasted pigeon!


FSA head of investment intermediaries Linda Woodall was reported as saying: “We are encouraged to see a large number of advisers plan to provide advice to people with smaller pots to invest. It is important that a range of services will be available for consumers once the changes to financial advice come in.”

Really? What is a large number of advisers, how do they know? Is this a case of the FSA being told in a survey what they want to hear rather than what they need to hear?

The FSA’s findings follow research published by Deloitte earlier this month, which estimated up to 5.5 million customers would stop using, or lack access to advisers post-RDR as a result of adviser charging.

Now, if the FSA assumptions are correct it will be in large part due to the in-built sense of customer care that advisers have for their clients.

But, if they are wrong and client requests to their adviser cannot be dealt with on a pro bono basis, and they will not pay a fee, what happens?

Well to quote Captain Blackadder ”A large crisis requires a large plan”.

But I think there is not one.

To parody what Blackadder might have said,  “Come on George, with thousands having lost their jobs in this industry in the last year or two, who’s going to miss a small IFA next year? 

And we are trying to find out what the true landscape of RDR shifting sands is.

Can you help us to help you by completing this important survey?

So far, a few ‘hot of the press’ insights are showing that:


  • Strength of client relationship is almost as important as AUM when segmenting clients
  • Most plan to offer differentiated services to meet diverse client needs
  • Preference for adviser charging through the product vs. fee paid direct by client
  • Move to restricted may be higher than the FSA claim


Do you agree? 

We have extended our survey to run until Wednesday 5th December. So please take the survey today, it will only take up 10 minutes of your valuable time.

Results from a survey like this could cost a firm around £5,000 and advisers often would not get sight of it. However, to recognise the importance of your input, these will be shared in December with you for FREE – the most important person in this exercise.

The results will allow comparison of your RDR problems, experiences, successes, failures and solutions with your peers that will no doubt help you fine-tune your newly formed proposition.


Thank you in advance for your assistance in completing this survey.  Simply click on this link to begin.

Not just any old RDR Survey

In November 2011 the Panacea community took part in a survey designed to tell Mr. Sants and the FSA what they felt about RDR.

Response to the survey was simply incredible, being completed by over 750 advisers who provided a wealth of feedback.

Importantly, the research did reach the attention of Hector Sants and Martin Wheatley as it highlighted the woeful fact that the FSA had not thought at all about RDR awareness creation and who should do it.

Twelve months on, we are getting very mixed messages about the considerable challenges and opportunities posed by RDR?

  • Will your business be ready?
  • Will you be ready?
  • Are your clients ready?
  • What support do you need?
  • What message do you want to send to the FSA?

As a result, we are conducting further research, in collaboration with our partner Market Research Agency GfK, to enable us to better understand current trends and attitudes.

The survey will be running from 14th November to the 28rd November. Unlike some recent formal RDR surveys, we are doing this as we really want to help you and most certainly not catch you out!

Importantly, the results will then be shared with you to allow comparison of your experiences with your peers, something that does not often happen.

Please let your industry colleagues know about this survey too. Ten minutes of your time will be, we are sure, very well spent and the results no doubt enlightening for what will be a very interesting year ahead.

Thank you for your assistance, to complete this survey, which we really hope you do, simply click this link

Say it’s not so!

Over the last four weeks we have been running a snapshot poll on RDR readiness. Over 600 have responded and so far only some 21% of respondents say they will be ready

This is currently showing that very few advisers will be ready by the year-end. With only 52 days left, what are the problems that are causing this very sad picture to be revealed?

We will be doing a more in-depth survey in the next week or so that I hope will provide a more granular insight into the problems and hopeful assist in delivering some support solutions to “those in peril on the sea” of change.

Lee Werral from CEI Compliance has some thoughts that are worth sharing with you right now. He observed that;

“The results are hardly surprising. RDR readiness is a very generalised and overused term that can mean many things to many people. One argument I have heard recently is that many firms are unprepared, as they have only had 6 years notice, whilst the counter has been that many rules for the ultimate landscape have only been laid down in the last 12 – 18 months.

So is the question being asked meaning that there will be full competence for 1/1/13; or maybe that IFAs expect to have their systems and controls in place by that time, or have they fully prepared their client base for the change and got their disclosure and proposition documentation in place?

Or all of these?

There is still time to engage a qualified someone to look at the whole setup within each firm to assist them to be RDR ready and to provide an external assessment of the readiness with recommendations and “sleeves rolled up” assistance if it is needed.

With the firms we have worked with, preparing them for “RDR Readiness”, other than competence, we have identified a number of areas that need to considered and discussed including;


  • Business Vision and Mission Statement
  • Business Plan
  • Target Market
  • Industry Analysis:
  • Client Segmentation
  • Marketing & Sales
  • Your Service Description
  • Mistakes to Avoid
  • Operational Plan
  • Financial Crime Systems & Controls
  • Data Security
  • Combating bribery and corruption
  • Remuneration
  • Technology
  • Investment Process
  • Focus on risk and return – profiling
  • Growing and Recruitment
  • Compliance & Risk
  • TCF 
  • Management Team
  • Joint Ventures (JV) 
Appointed Representatives – The Firm’s Responsibilities
  • Exit Strategy
  • End Game Planning

So if the question is are all these things in place or documented, the responses are unlikely to be yes, as many of these areas have not been fully explored. As far as being technically ready by all the competence and operational requirements to satisfy the FSA, then I am sure the great majority will be yes, (but will be more ready in the next few months).

The light is on but….FSCS Survey results

The FSA proposed to hike its annual costs by 15.6 per cent from £500.5m for 2011/12 to £578.4m for 2012/13[i]. This is on top of an FSCS levy of £33m for 2012/13 confirmed in its plan and budget.

The FSCS levy will be consulted later this year and given its inherent unfairness and the ever-increasing large and unexpected cash calls on adviser firms PanaceaIFA hopes these plans change.

In the run up to this consultation, PanaceaIFA conducted a survey to which nearly 500 of you have responded, producing a 100 page document of answers and feedback. Many thanks to all of you who responded.

The results have been sent to Martin Wheatley at the FSA, Mark Neale, at the FSCS, Chris Hannant at AIFA and Mark Garnier at the TSC.

We conducted our survey over a three-week period from mid July to early August and the results are quite alarming in some ways and very predictable in others.

Whilst it would be possible to dismiss some aspects of the survey, as well as some of the methodology, the responses and results do carry weight because of the strength of response and depth of comments.

It appears that the issues raised have not been addressed in either FSA or FSCS research to date and I hope they find the information contained helpful. The point this research reveals is that there is an inherent sense of unfairness about the scheme, what is meant to do and how it is funded.

It also gives some interesting insight as to what alternatives could be considered.

Our survey is ultimately about preventing consumer detriment by digesting IFA perceptions, understandings and appreciation of the FSCS from those who know it best- their IFA funding group.

The message to the FSA, FCA, FSCS and the TSC is clear. Please listen, learn and above all act now before it is too late.

The survey saw 491 respondents and the results, with comments, stretch to some 100 pages. The document makes for compelling reading.

Some key facts to digest

1. Over 47% of IFAs see the data breakdown asked for regarding income that leads to their fee being calculated is difficult to provide.

2. Nearly 50% of apportioned fee income on returns equate to ‘General Advice’.

3. 71% of respondents see that any future levy should form part of a mandatory disclosure to clients so that they can see what the cost of the levy is to them in cash terms.

4. An alarming 97% of IFAs believe that there needs to be more transparency over how the FSCS arrives at its 2012/13 levy.

5. 92% of respondents feel that there should be much greater clarity of the levy by specific product type.

6. Unsurprisingly 97% of IFAs believe that the current system unfairly penalises firms who conduct themselves responsibly

7. 37% of respondents felt that mandatory PI cover should not be abolished, 24% were not sure and 39% felt it should be abolished

8. Some 302 commented on alternative suggestions to replace or improve the scheme- some great reading here.

9. 54% felt that those in receipt of FSCS compensation should have an excess deducted.

  1. This question has produced a very dark position for the FSCS and the industry as a whole. 52% of respondents said that increasing levy calls could put them out of business because they would become unable to pay.
  2. And some 22% of IFAs said that recent requests to ring fence assets could make their firm insolvent and as a result placing them into the FSCS compensation pool.
  3. 57% of respondents felt that a product levy could also fund the MAS.
  4. 64% reckoned they did not have run off cover or could not get it if needed- mainly due to cost.

So will the FSA and FSCS be surprised? They certainly should be along with all those who have concentrated so much on driving through a process that, if this survey is to be believed, has so far manifestly failed to consider the fairness of the scheme upon those who are expected to fund it and how the potential inability to pay ever increasing and possibly unfair levies going forward will many more firms in default inevitably creating consumer detriment for the very people it is meant to protect.

This survey also addressed some demographics, for example over 70% of respondents have been in the industry over 20 years and that 65% were 50 years or more old. And most surprisingly of all we note that some 30% of respondents were part of a network or affiliated to a support group. This shows that Panacea clearly can get to the parts that others often cannot for the greater benefit of the IFA community, the industry and of course the consumer.

As the great, late Steve Jobs said “Design is not what it looks like or feels like. Design is how it works”. With the FSCS it does not and needs to go back to the drawing board.

To see the full report.