In its final guidance issued today, the FSA set out examples of good and bad practice it discovered around firms' use of model portfolios, discretionary fund managers and distributor-influenced funds.
It follows a thematic review by the regulator, which uncovered widespread failures at some firms. The FSA said poor outcomes can occur if firms fail to: consider the needs and objectives of their target clients when designing or adopting a centralised investment proposition (CIP). consider whether the CIP is suitable for each client on an individual basis. establish a robust control system to mitigate risks which might arise from the CIP. Considering the needs and objectives of your target clients Good practice One firm used feedback from its clients and identif...
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