The Financial Services Authority (FSA) is planning to up its focus on advisers and wealth managers placing large amounts of client money in a single fund, amid fears some firms are not carrying out sufficient due diligence.
In an expansion of its work on suitability, the FSA is understood to have held talks with a number of law firms around concentration risk in certain investment vehicles. The talks centre on the percentage of a firm’s AUM invested in single mandates, or asset management teams, and hark back to previous crises which impacted large funds. As well as looking at amounts invested, their processes may also come under scrutiny. Wealth managers currently send out Request for Proposal (RFP) information forms to asset managers before investing in their funds. However, Investment Week under...
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