The Financial Conduct Authority's (FCA) current stance on the definition of independence is at odds with the views of up to half of the IFA community, according to research.
In TR13/5 Supervising retail investment advice: how firms are implementing the RDR; the FCA said if a firm directed almost all of its business to a single platform, or via a single investment proposition, it was not acting independently.
However, consulting and advisory business NMG polled 214 IFAs and found almost half (49%) believe that a firm adopting a single platform solution should not be prohibited from referring to themselves as an IFA.
A further third (34%) held a similar view over the use of a single investment proposition.
Meanwhile just over one-third said they were willing to consider a move to a Restricted Advice model were the FCA to give explicit guidance that a firm that uses a single platform could not refer to itself as being independent.
A further 30% confirmed they would also consider moving to Restricted Advice if the FCA took a similar stance on firms offering a single, centralised investment proposition.
David Burns, director at NMG said: "The past few years have seen a transformation in adviser business models with many firms no longer wedded to traditional views on independence. Many view platforms as providing no more than administration and simply do not accept that reliance on a single platform compromises their independence.
"The rapid growth in centralised investment propositions reflects a sea change in attitudes with many IFAs now questioning whether they can, or ought to, hold themselves out as quasi fund managers, designing and managing individual bespoke portfolios."
Headed up PFS for eight years
Questions over fairness
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