The FSA announced the results this week of an investigation they had made in to 16 wealth management firms.
Worryingly, but unfortunately unsurprisingly, they found 14 out of the 16 firms had implemented unsuitable portfolios for their clients. Why is this?
The official line was that advisers fail to really understand their clients and the risks they are willing to take. The FSA suggested that advisers lacked a ‘wealth’ of information about their clients.
I think this really just comes down to wanting to get to know people. Too many advisers whether in a bank, a large company or trading on their own as an independent financial adviser, think they have what the client wants.
How many times have you spoken to an adviser that you felt already had the solution before you even walked through the door. The commission based, quick-sell culture has gone on for far too long and I’m pleased to say that it is coming to an end in January 2013 (at last!).
For me advising my clients really well is more about listening to them talk than me providing a solution. If I don’t know and understand my clients as people then I can’t even begin to advise them on what to do with their money.
To me that just makes sense, but I guess what the FSA have found is that there is a lack of common sense among some wealth management firms. In fact 14 out of 16 they interviewed. Is one of those yours?
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