29 November 2023
If you are covering the FCA consultation on capital deduction for redress: personal investment firms, please see comment below from Steven Levin, CEO of Quilter:
“We are fully supportive of the polluter pays model. It means that bad actors who have caused harm, or threatening to harm consumer outcomes will be penalised for their failings. While we need to understand the detail, it is likely that quality firms will broadly support this type of reform, which could serve to build trust with consumers and give greater confidence in advice in the longer term.
“We expect that larger firms, such as Quilter, already operate capital models that include the need to actively monitor for potential client remediation and, as such, already incorporate this methodology in their approach when determining the capital requirements of the business.
“While it may create additional work for smaller firms, as they will need to rigorously understand any potential need for future redress, it is better than the current unpredictable and significant ad-hoc costs under the FSCS which makes effective business planning difficult and can have a knock-on impact on investment in other areas.
“Through a more rational model for the capital that needs to be set aside and the right support that enables good client outcomes on a consistent basis, firms will be able to invest in the future growth of their business without the uncertainty of unexpected levies derailing their plans.”
