MMR: Pink says proposals are a boon to brokers

It believes the proposals are focused on achieving the right consumer outcomes.

David Copland, chief executive of Pink, said: “I think the FSA has got it spot on regarding its proposals on distribution and disclosures, I absolutely agree with them on their stance regarding advice and execution only.

“There has been no doubt in my mind that if a conversation is had verbally or interactively with the consumer that the recipient believes they have received advice.

“I also agree with the proposal to offer execution only type sales for very specific customers and for when the consumer opts to choose the product themselves.”

Copland added on the topic of initial disclosure that whilst there was a proposal to remove the Initial Disclosure Document he thought that most intermediaries would choose to issue a similar document outlining their services.

He said: “Intermediaries will still be required to furnish the client with the scope of their services in a durable form so I believe a form of the IDD will still be required.

“However intermediaries will not be able to hide behind the fact that they have issued this document as they are required, at the outset, to outline their remuneration and scope of service verbally.

“This may lead some intermediaries to recording their initial conversation with a client in the event of a subsequent complaint in order that they can prove it took place later.”

Copland added that he agreed with the proposal to lay the responsibility for affordability assessment firmly with lenders.

However Copland also said: “Intermediaries will still be required to ensure that consumers meet lenders known eligibility requirements, which is a reasonable thing to expect and do.

“I am encouraged by the FSA’s approach to the feedback from the previous three papers, the FSA has listened and acted upon the feedback, this paper is both succinct and the proposals are far more practical.

“I also agree with their timelines. This is all about making sure that when the market recovers we have rules in place that protect the consumer but also allow the market to expand again a controlled manner.”