FSA sets out to dispel regulation myths

"The market – perhaps not unsurprisingly – is full of partial information and quite a number of myths about the implications of statutory regulation and direct authorisation. For example,

It is not true that the FSA does not want to regulate sole traders. We have redesigned our systems to cope with thousands of small firms.

It is not true that small firms won't be able to afford direct authorisation. Many small firms are already authorised by the FSA. We have set fees for the mortgage and general insurance sector that reflect firm size and the relatively lower risks associated with these products. There is no automatic relationship between the cost of being an authorised firm and the cost of being an appointed representative.

It is not true that firms have to buy the whole FSA Handbook, nor that it costs £1600. All authorised firms receive the Handbook for free on CD ROM, and regular updates. Anyone can access the Handbook via the FSA website: http://www.fsa.gov.uk

It is not true that the whole FSA Handbook is relevant to small firms. The Handbook covers all firms regulated by the FSA. That means that much of it is not relevant to small mortgage or general insurance intermediaries. The mortgage and general insurance source books explains which parts of the handbook apply to firms.

It is not true that firms will have to employ a compliance consultant. Firms need to review our requirements, using all available the information, establish what changes they need to make to business practice to comply and take action. Some firms may choose to take professional advice but this is their choice, not our requirement.

"Clear, accurate and unbiased information is available on our website, www.fsa.gov.uk/mgi. If you cannot find the answer there, then ring our contact centre on 0845 6055 525. "