Ah, regulatory compliance. The gift that keeps on giving. If you’re a financial adviser, you’ve probably spent more time these past few years wrestling with compliance than actually advising. And just when you thought the worst was over, here comes the FCA with yet another review—this time into consolidation. It’s like the advice industry is stuck in a never-ending loop of reviews, each one more exasperating than the last. Ongoing advice review, retirement income review, and now this. It’s as if the regulator’s motto is, “You can check out any time you like, but you can never leave.” Hotel California, anyone?
Is it any wonder that over half of financial advisers have thought about throwing in the towel? Honestly, who could blame them? It’s a treadmill of paperwork, audits, and looming fines. Every step forward is met with another compliance hurdle that makes you wonder if it's even worth it. Just when you think you've cleared one obstacle, the FCA finds a new way to review your escape route and reel you right back in. And now, they’re casting their eye over consolidations, warning of “harms” that could arise from firms acquiring others without the proper checks. Cue the dramatic music.
The FCA’s latest letter—sent with all the usual pomp and circumstance—lays out the latest set of expectations for advisers, like we didn’t already have enough of those to deal with. They’ve noticed an increase in acquisitions, and while that could have its benefits, it seems they’re more concerned about the "types of harm" that might occur if it’s not done prudently. Translation: more hoops to jump through, more forms to fill out, and, oh yes, don’t even think about skipping regulatory approval. That could result in enforcement action or, better yet, criminal proceedings. The dream just keeps getting better.
Of course, it doesn’t stop at consolidation. The FCA is also still wringing its hands over ongoing advice charges. Apparently, a whopping 90% of new clients are being set up for ongoing services, and the regulator isn’t quite convinced that’s always in the clients’ best interests. Now they want firms to make sure they’re delivering “good outcomes” and not charging for services that aren’t provided. Yes, because advisers just love spending time monitoring every tiny transaction and making sure clients know they can cancel services anytime. A simple, straightforward system? No chance.
So here we are, at the crossroads once again. Advisers stuck in a compliance quagmire, with debts that feel more like shackles around their ankles. And let’s face it, when will enough be enough? The industry is losing advisers by the day, worn down by endless reviews and increasing regulation. Maybe it’s time to retire from the advice world altogether and step off the treadmill for good. A career in planning, perhaps? No compliance millstone, no constant reviews. Just straightforward, client-centred work, without the FCA breathing down your neck every five minutes.
At the Academy of Life Planning, we can show you how to step into the world of planning without being forced to repay those pesky compliance debts like ball-and-chain accessories. After all, who wouldn’t want to escape from this Hotel California existence?
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