Advisers ‘should record client interactions’ FCA suggests

Financial advisers should consider recording client interactions to help both in the event of a complaint and in understanding their clients’ needs better, an FCA director has advocated.

Although not a legal requirement, many firms had already invested in this, noted FCA director of life insurance and financial advice supervision, Debbie Gupta.

Speaking at a conference in Harrogate last week, she said: “New and innovative technology means this is not a prohibitively expensive option. Recordings provide the most robust evidence available for a firm to make its case in the event of a complaint. Even if you aren’t recording the meeting, your client’s voice should still come through the fact-find loud and clear.”

Citing the example of when the FCA looked at the advice given to British Steel scheme members in 2017, she explained: “The files where the client’s genuine feelings were recorded in their own words often resulted in better quality advice.

“This is because the adviser could understand and empathise with the client and tailor the advice to the individual client. Under challenge or scrutiny, it helped explain the context in which the advice was given, and provided insight into what the client really wanted and needed.”

Gupta also told the audience of financial advisers and intermediaries that her team’s work at the FCA was focused on improving industry standards, targeting firms that caused the most harm, supporting consumers and helping advisers.

She added: “Consumers are responsible for making an increasing range of choices about how they invest their retirement savings. As our population ages, these choices can impact on the quality of life they enjoy in their later years. Bad choices based on poor quality advice can’t be easily undone or reversed. And poor retirement outcomes for these consumers can be devastating.”

Gupta also called on advisers to be “brave” enough to challenge clients and offer alternative options, particularly if a client’s orders were based on misunderstandings of a complicated area such as pensions.

“Challenging misconceptions and client education is core to good advice,” she argued. “You are the experts. You will always know more than your client and we expect your expertise to support your clients in this way. It is what we expect of the services you are paid to provide.”

    Share Story:

Recent Stories


FREE E-NEWS SIGN UP

Subscribe to our newsletter to receive breaking news by email.


Every Mortgage Tells a Story
Vida Homeloans is the award-winning specialist mortgage lender for residential and buy to let customers who may not fit the criteria currently demanded by high street lenders. View this video now on how Vida help those in their personal circumstances or their investment strategies.