Investment - Articles - PIMFA to work with FCA on proposed polluter pays model


PIMFA has noted the proposals from the Financial Conduct Authority (FCA), for personal investment firms to hold additional capital to pay for consumer redress, as the first stage towards a ‘polluter pays’ model of consumer compensation.

 Liz Field, Chief Executive of PIMFA, commented: “We note the Financial Conduct Authority’s (FCA) proposals on extending capital requirements to personal investment firms to cover future consumer redress.

 “We strongly believe in, and have argued the case for a number of years, for a ‘polluter pays’ model to compensate consumers that have received a poor outcome, and we are aware of the moral hazard the existence of the Financial Services Compensation Scheme (FSCS) provides for well-run firms funding the misdeeds of others.

 “We would stress the need for these proposals to be proportionate, and specifically not to act as a barrier to firms wishing to enter the market. While we do strongly believe that these proposals will incentivise good advice, the FCA must be mindful that it does not strangle the supply of advice to consumers.

 “We look forward to engaging with the consultation process and would urge the FCA to be mindful to the fact that, at least initially, firms will face the prospect of two charges by way of the FSCS levy and the requirement to hold additional capital as proposed. We still believe additional sources of funding to subsidise the FSCS levy should be considered to reduce this burden and would continue to urge the FCA and Treasury to consider FCA fines to subsidise the FSCS levy in the short term.”
  

Back to Index


Similar News to this Story

Inheritance Tax raises almost GBP6 billion in 8 months
December’s update from HMRC shows that Inheritance Tax (IHT) receipts reached £5.7 billion through the first two-thirds of this financial year (April
PIC completes first Mosaic buyin with GCB Pension Fund
Pension Insurance Corporation plc (“PIC”) has concluded its first full scheme buy-in within Mosaic, PIC’s streamlined service for pension schemes with
Airways Pension Scheme complete longevity hedge with MetLife
The Trustees of the Airways Pension Scheme (“the Scheme”), Metropolitan Tower Life Insurance Company, a subsidiary of MetLife, Inc., (“MetLife”) and Z

Site Search

Exact   Any  

Latest Actuarial Jobs

Actuarial Login

Email
Password
 Jobseeker    Client
Reminder Logon

APA Sponsors

Actuarial Jobs & News Feeds

Jobs RSS News RSS

WikiActuary

Be the first to contribute to our definitive actuarial reference forum. Built by actuaries for actuaries.