Consultation needed on disclosure before mandatory action, says broker body
Biba has played down the FSA threat of mandatory commission disclosure should brokers fail to manage potential conflicts of interest.
Steve White, regulation and compliance manager at Biba, said the FSA would not be able to mandate full commission disclosure without a consultation process.
Many brokers are against full commission disclosure, claiming it adds greater pressure to their businesses.
White also said that the FSA would not be able to impose commission disclosure for commercial clients without also doing so for retail customers.
"No one wants disclosure in retail markets," he said.
White's comments come as the FSA's deadline for brokers to submit details of how they are managing conflicts of interest expired.
Last week, Insurance Times reported apathy among brokers in relation to submitting responses to the regulator, raising fears of a tough response from the FSA.
The FSA would not reveal how many responses it had received or how it would proceed.
An FSA spokesman said: "What happens next very much depends what we find in the responses."
The FSA will crack down on non-compliant management in 2006, experts have warned.
John Liver, a partner with Ernst & Young's UK regulatory services, told delegates at a Complinet compliance conference last week: "Expect to see an increased focus on individ-uals and senior management."
Richard Wynn, director of professional indemnity specialist broker Howden UK, said the FSA would target individuals in a bid to scare others into line.
An FSA spokesman said: "2006 is a year when things need to happen. We are expecting brokers to do things properly and we will be actively overseeing to ensure firms are getting it right."