Speaking at a British Bankers Association conference recently, the industry watchdog, the Financial Services Authority commented that direct sales forces from banks and building societies were largely to blame when it came to mis-selling.
The FSA also said that they would be clamping down on the banks and building societies in an attempt to cut mis-selling and improve consumer confidence.
Our View
We have been waiting for this news for so long. Many direct sales forces of the bigger banks and building societies give financial advisers a bad name. The so-called advisers are given huge targets to meet and this aids mis-selling when recommending the highest commission paying policies.
The Financial Services Authority has been told on so many occasions that independent financial advisers are very rarely to blame for mis-selling. In fact, in a recent report from the Financial Ombudsman Service, they found that the minority of complaints were about advice given by independents. If the FSA clamp down is done quickly it will repair the reputations of direct sales forces and enhance the stance of the FSA in terms of doing the job they are paid to do.