Too many independent advisers are feeling intimidated by the incoming regulatory regime, says Ryan Edwards, Managing Director of The Adviser Platform (TAP). However, the firm is offering a helping hand with a free FAP policy & framework pack.
“There’s around 1,500 to 2,000 independent self-employed advisers who are faced with setting up their own systems to meet the new regulations by March 15, and that’s a big ask for solo operators and small adviser practices,” says Edwards.
“But our compliance team is helping a fair number of advisers with a free policy & framework kit to help them understand what’s required to stay on the right side of the regulator.
“It’s essentially a FAP in a box that pulls together all the policy and process documentation that advisers need to know, and we are sending them out free of charge to all the people we are working with.”
The policy & framework pack covers areas such as privacy, outsourcing, disclosure, record keeping, data protection, and working with vulnerable clients.
There has been this real confusion and uncertainty around which policies an adviser needs to have in place…
“There has been this real confusion and uncertainty around which policies an adviser needs to have in place,” says Edwards. “So rather than ask clients to start with a blank sheet of paper, we have written it for them, and given advisers the ability to tailor the documents to their business.”
However, Edwards says, the real work test is when an adviser is asked by an insurer or regulator to demonstrate they have met their requirements.
“TAP’s managed administration team, and our custom CRM, records all the hard work these advisers do and we make sure it is recorded in detail so they can prove they are always across their obligations, and that they are indeed doing the right thing.”
Edwards says his firm’s range of back-office services are menu based so advisers can choose which of them they need. He says 30 advisers have joined its platform so far this year.
The thing with the new regime is that we are moving into a principles’ based environment, so there is no check box to tick…
“The thing with the new regime is that we are moving into a principles’ based environment, so there is no check box to tick for the regulator to judge if it is correct or not correct,” says Edwards.
“We document what advisers do, and allow them the operational freedom to demonstrate that they are actually working within the regulations. We have always said that getting the FAP licence isn’t the hard part. It’s the ongoing day-to-day operation that matters.
“Assuming advisers are doing the right thing in front of their clients we are very confident that they can, and should, be running their own FAP with confidence. Just like they are running their own business now.
“But there has been some scaremongering that has made some assume they can’t do it, and we take a very different view.”
Edwards says that while the independent adviser has not had to pay a lot to run their business to date, if they are prepared to make modest changes and invest a little to fund their business, “…then there is no reason why they can’t maintain their independence and look to grow their practice to help more clients”.