Financial Services Authority data based on figures supplied by product providers reveal an increase in advised sales of retail investment products that pay recurring trail commission ahead of the Retail Distribution Review, according to a statistical release issued today (31 August).
While FSA data show an increase in such sales, the report does not state by how much sales had increased.
The regulator also pointed out an increase in the proportion of bonds sold with advice from life insurers, which rose from 24 per cent to 40 per cent.
The FSA said: “Investment bonds sold by insurers act as ‘wrappers’ for other products, and a quirk in the rules means that they will continue to pay commission after the RDR is implemented.
“There is a concern that some advisers will exploit loopholes in the RDR to continue to earn commission.”
Source: FT Adviser. Read full article here.