Regulation
The might of the Financial Services Authority (FSA) was reiterated to delegates at the AMII conference.
Compliance consultant Branko Bjelobaba warned advisers that the new regulator would not turn a blind eye to bad practice and broken rules could lead to a custodial sentence.
"Breaking rules could put your liberty at risk. No one has been locked up yet, but there is sure to be a first," he said.
Bjelobaba said that when advisers agree to abide by the new rules, they should take their commitment seriously.
"No one up until now has told you how to run your business. The FSA is going to now and you are signing up to say you will do this," he said.
The need to make contingency plans should something happen to disrupt business was highlighted during his speech. Bjelobaba said the FSA will require advisers to make sure their business can continue to function in the event of unforeseen circumstances. This, he said, included everything from 'fire to IT failure and supplies of stationary.'
Bjelobaba also reminded advisers that if a complaint is made against them under the new regime they will have to pay a complaints handling fee, regardless of whether they are to blame.
"Private medical insurance brokers are very focussed and switched on, compared with others. However, it is not just about becoming authorised it is about staying compliant. While the FSA may be thought of as a cuddly regulator, remember it has massive teeth," he said.
