SimplyBiz director urges advisers to 'know your regulator'

He noted that principle-based regulation leaves room for interpretation - and therefore ‘a great deal of uncertainty’ can develop for firms about the application of these principles.

Exploring the Financial Conduct Authority’s business plan, Golder touched on their focus on providing advice - including low cost advice - that is delivered in innovative and accessible ways moving forward. Noting that it is still the case that only a small proportion of the UK’s population have access to face-to-face, quality advice, he predicted that “more automation will play a part in advice roles in the future but most consumers will always prefer dealing with a professional adviser”.

He also discussed the regulator’s interest in the use of data and technology, noting that firms should be aware that good record keeping is critical in this area.

Golder mentioned that, in cases SimplyBiz had reviewed:

“There isn’t a lack of willingness to engage, or willingness to comply, or even a lack of understanding of the principles - there’s just a shortage of record keeping. It is critical in a regulated activity that all steps are adequately recorded in a durable medium and can be referred to if necessary.”

As a result, he said, firms need to ensure their sales process is thoroughly documented and that client files ‘properly reflect’ stages of that process.

He concluded that it was crucial for those in the industry to give the regulator feedback during their consultation periods, adding:

“If the regulator is going through a period of better understanding the sector, it should have the benefit of regular feedback from practitioners. Together we have historically been able to inform change to regulation, and help the regulator to understand the real, practical issues that the sector faces.”