Liz Walkington, communications manager at RJ Temple, said: "In relation to Consultation Paper 121, the FSA seems to suggest that IFAs who want to continue operating on a commission basis, but still deal with the whole market-place, could simply adopt the AFA title and carry on as if nothing had changed. Our research shows clearly that consumers do not put the same value on ‘independent’ and ‘authorised’. In fact, it strongly suggests that an ‘authorised financial adviser’ would be equated to a tied agent."
The survey found that while 39 per cent of respondents said they would go to an IFA, and 10 per cent would opt to see an AFA, it was interesting to note that 14 per cent had no preference and worryingly 27 would not go to either.
Walkington said: "Consumers seem to regard ‘authorised financial adviser’ as equal or similar to a tied agent. This increases our concern over the fact that CP121 seems to make no distinction between an AFA that deals with the whole marketplace - i.e. independent except for taking commission - and one that is tied to just a couple of companies.
"We believe the independence of advice matters more to consumers than the method of remuneration. It is vital that those who want independent advice, whether paid for by fees or commission, can be sure of finding it and that a blanket title does not mislead consumers about the nature of the advice they are actually getting."