FCA sets out financial adviser expectations

The FCA’s latest portfolio supervision letter to financial advisers and investment intermediaries sets out where it sees the most potential harms that the sector could generate and its expectations on firms operating with in the sector. The letter focuses on:

• retirement income advice, in particular the need to properly consider client needs and therefore deliver good outcomes;
• the relevance and costs of ongoing advice services;
• the need to hold adequate financial resources in line with the “polluter pays” principle;
• the potential dangers of consolidation in the market and the need both to ensure all increases or acquisitions of control are FCA approved, to ensure that good outcomes are prioritised, to undertake appropriate due diligence on the selling firm or client bank, to hold adequate financial resources at all times and to always take into account FCA’s supervision review report and guidance.

The FCA will be looking closely at all these areas, as well as testing and monitoring Consumer Duty compliance and looking at how firms consider opportunities to support clients on the advice guidance boundary review.