Almost half of Advisers don't undestand FSA requirements to evidence TCF

Almost half (46%) of the adviser population is confused and uncertain over what the FSA requires from them to evidence TCF principles by the December 2008 deadline – just 7 months away.  This was one of the key findings of the new 1st - The Exchange, TCF research study.  In an online poll, completed by over 560 adviser firms last month, just over half (54%) said they confidently understood what the FSA wanted from them, to evidence TCF principles in their firm. 

In a further question, looking at how many firms believe they are already able to evidence TCF principles, only 51% of firms said they were confident they could meet the requirements now. 41% believed it was only ‘possible’ they could satisfy the Regulator now and the remaining 8% said it was ‘unlikely’ or ‘not at all’ likely.

David Child, managing director of 1st - The Exchange, comments:

“With the amount of new and growing regulation which advisers are now facing, its obviously proving costly for many firms to invest the time and research needed to ensure adherence to all the new rules, whilst keeping business levels up under difficult market conditions.  However, it is rather concerning that so many advisers don’t understand what is needed to be able to evidence TCF across their business, particularly when the FSA deadline is looming. 

“Having worked with many firms in this position, on our training courses, we believe that having a business process which embraces the benefits technology offers is vital.  With good data management and efficient use of e-services, collating and managing the information needed by the Regulator should become a very simple and straight-forward process.”

Looking forward to the December deadline, a minority (40%) of advisers claimed they were ‘very confident’ of being able to reach the levels needed to evidence TCF, with the vast majority being less or ‘not at all’ confident.

Philippa Gee, investments director at Torquil Clark, comments:

“Whilst it’s not really surprising that some advisers are struggling with the interpretation and implementation of the new TCF principles, given their complexity, for us the process has been quite a simple one as we have a very streamlined business process - which has made this much simpler and easy to achieve.
 
“All our client data and communications are stored in one central back office system and our advisers can access this remotely, producing an audit trail of data.  We are confident that our systems are capable of meeting and evidencing TCF, but we realise that this is not the case for many firms, particularly those without the right systems and technology in place.”