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FSA cracks down on UK wealth managers

The UK’s financial services regulator is cracking down on the country's wealth management firms, following revelations of “significant widespread failings” within the sector.
FSA cracks down on UK wealth managers

The UK’s financial services regulator is cracking down on the country's wealth management firms, following revelations of “significant widespread failings” within the sector.

The Financial Services Authority is to interview wealth managers as part of its investigation, after finding problems with record keeping and the suitability of advice given by some advisers to clients.

Its focus on the sector follows a review of 16 wealth management firms in the UK last year. The FSA found that 14 of the groups were posing a “high or medium-high risk of detriment” to their customers. The survey also found 80% of those reviewed had a high risk of “unsuitability” to client needs.

Following its research, the FSA sent a letter in June 2011 to chief executives of all UK wealth management firms asking them to identify and deal with any problems that could affect clients.

“We will be acutely interested in whether firms have heeded the warnings and concerns contained within our previous communications. We will provide further updates on this work in 2013,” the FSA said this week in a statement.

Following interviews with wealth advisers, the FSA will decide on whether more regulatory action is required.

Picture © Press Association

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