FSA has written to CEOs of a sample of the largest providers and distributors of retail investment products noting its concern that some firms may be looking for ways to circumvent the adviser charging rules. It states that payments which are intended to achieve the same result as commission, but are structured so as not to look like commission, are not in the spirit of the Retail Distribution Review (RDR). It is also concerned about how firms comply with the inducements rules. The letter sets out examples of inducements that worry FSA and requires firms to confirm their distribution and other relevant agreements comply with current inducement rules and will comply with the RDR. Firms must also provide FSA with information about their agreements. FSA has requested acknowledgement of the letter and asked for full responses by 15 October. (Source: FSA Writes to CEOs on Inducements and the RDR)
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FSA writes to CEOs on inducements and the RDR
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