Good Returns understands there has been a lot of concern from advisers about the decision to name the two advisers involved and how that decision impacts on other advisers.
McMorran acknowledges that it was an issue which was brought up at the IFA's Council meeting last week.
However, she says that the decision to name the advisers was not taken lightly and it was the committee's view that the breaches of the institute's code were serious.
She also says the two advisers "showed few overt signs of contrition or regret for the position their advice had placed their clients in and they both tried to avoid responsibility for their actions."
As the two complaints revolved around advisers putting clients into finance companies which subsequently failed, other advisers are asking whether they are at risk because they had invested clients in the same firms.
McMorran says no. The decision was not based on the advisers' product recommendations. Rather it was based on the fact that in both cases they had not followed a proper process."
"If you know that the advice you provide to your clients adheres to those Codes and standards, you need never have any worries that a complaint from one of your clients might result in a similar penalty being handed out to you."
McMorran says the decisions made by the committee are based on the Codes of Ethics and Practice Standards, "it is not the brief of the Disciplinary Committee to make a judgment on whether there has been any diminution in value of the client's funds."
| « News Round Up | Sovereign takes regulation bull by the horns » |
Special Offers
© Copyright 1997-2024 Tarawera Publishing Ltd. All Rights Reserved