FCA: We don’t want IFAs to be ‘order takers’

The FCA does not want advisers to act as “order takers”, its IFA technical specialist has said.

Speaking at Finalytiq’s Science of Retirement conference today, Chris Hewitt urged advisers to question the client’s motivations behind their request before transacting any business.

He said: “We do think advisers shouldn’t be order takers. If a client comes in and says, okay, I want to have my pension, it’s probably not a great outcome for advisers to do that no questions asked. Part of advisers’ role is to challenge clients and understand what’s driving that decision.”

Hewitt said that the aim of the adviser should not be to be “confrontational”, but to help clients make more informed decisions.

Hewitt said: “We do recognise with the introduction of freedom and choice, quite a few people now see pensions in a different way, as just another tax efficient savings vehicle that can be used for a wider range of objectives.

“For a lot of consumers there are going to need to be compromises on how they use their assets, pensions included…There’s a key role for advisers.”

“It’s really important to get those good quality client objectives at the outset, really understand what the client is approaching you for.”

Insistent client issues

However, Hewitt said that when it comes to the issue of insistent clients who wish to transact against advice, dealing with these recommendations was a “commercial decision” for the firm, as long as they made the risks clear and documented that the client was acting against advice, as per the FCA’s guidance.

Hewitt replaced Rory Percival one of the key FCA liasons for advisers in October.

Hewitt was a lead associate in the FCA’s investment intermediaries department, and worked in financial advice before joining then regulator the Financial Services Authority in 2010.

Hewitt, who is level four qualified, has been involved a number of thematic reviews around risk profiling, centralised investment propositions, investment advice at banks and RDR compliant adviser charging.