Brokers should live with, but not for, FSA compliance, according to Paul Smee, director general of the Association of Independent Financial Advisors.
Speaking at the BIBA Conference, Smee urged brokers to keep a sense of proportion and a sense of humour when dealing with the FSA.
“Regulation should not be a paper chase. That is not to say you should not keep records. It means you should communicate with the client. The client's interests are paramount. It is not just about ticking boxes.”
Speaking from his experience guiding the IFA market through regulation, Smee advised brokers to short-circuit problems before they reach the FSA.
He said regulation boils down into three golden rules: compliance should be a professional part of any company, not an add-on; rules beget rules; and that regulators abhor a vacuum.
However, he warned the market not to focus too closely on compliance and the FSA while the Ombudsman and European legislation are lining up to challenge brokers.
