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RDR - Investment Firms - Where are we now
It is clear that the RDR will primarily affect retail advisers. However it will capture investment managers where they also give advice to retail customers. Those investment managers who run collective investment schemes or deal exclusively with wholesale institutional clients will fall outside scope.
We have also confirmed that Investment Managers who work entirely in discretionary management will not have to adhere to the higher qualification criteria or stipulate whether they offer independent or restricted advice as they are not deemed to give advice to retail clients. However, firms should consider the client classification changes under MiFID and ensure that they are satisfied that those currently falling outside of scope will remain so. Similarly individuals will need to consider how the changes may impact them if they decide on a change of role or group in the future.
Options to explore RDR will affect a number of investment firms so questions to ask now are:
- How will we recompense IFAs for any clients introduced?
- What will be the capital and income impacts of RDR changes?
- What progress is being made by those individuals who do give advice?
- How does this affect our T & C Scheme?
- Should we start new entrants on a different qualifications path?
What can you do now
Now is the time for finalising strategy and implementing changes. Act now by:
- Assessing the progress of your advisers to meet the 2012 deadline and put in place firm plans
- Assessing the scale of the potential impact to your business model and current activities
- Reviewing your T & C scheme to address new entrants, CPD and SPS.
Click on this link to obtain the latest qualification update from the CISI. The article also contains a flowchart to identify the potential gaps in an individuals' qualifications.
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