In this regular column for Financial Planning Today, Dr Matthew Connell, director of policy at the Personal Finance Society, looks at the FCA's ongoing advice review.
At the end of February, the FCA published the results of its work on ongoing advice – probably the most important assessment of conduct standards in the advice sector for years.
The results were encouraging.
The FCA’s analysis of data provided by 22 of the largest advice firms, covering the previous seven years, showed that:
• In around 83% of cases, ongoing services were delivered to clients.
• In a further 15% of cases, clients either declined or did not respond to the firm’s offer of a review.
• In fewer than 2% the firm had not attempted to conduct a review.
The tone of the report was positive with the FCA emphasising that ongoing advice, ‘can be of great benefit to consumers’ and it introduced the report by saying it had: ‘found that financial advisers are delivering suitability reviews in the vast majority of cases’.
The work is not yet complete but the FCA expects firms to consider whether they can demonstrate they have delivered the services they promised and delivered redress, where warranted.
Firms should also discuss with clients who are paying for an ongoing service but choosing not to use it whether they really want to continue with the service.
The FCA has said it will ‘monitor complaint numbers’ and decide on further action, if needed, later in the year but overall, the FCA findings show a strong commitment to professionalism.
The FCA has also set out examples of good practice, including: clear communications about ongoing service, having effective systems in place to ensure the service was delivered and that recommendations were still suitable with policies in place to stop collecting fees ‘where a client had not engaged for a period of time’.
The PFS will augment the FCA’s guidance with a more detailed guide, shaped by practitioners.
• This column first appeared in Financial Planning Today magazine, Mar-Apr 2025 edition. Matthew's column appears in each issue of the magazine. You can subscribe to the magazine and read comment by leading industry figures by registering for Financial Planning Today website and then checking subscription options in 'My Account.'
Dr Matthew Connell is director of policy and public affairs for the Personal Finance Society.
https://www.thepfs.org/
