PIMFA 'disappointed' DFMs hit with 25% FSCS levy despite feedback

UK's 'pool of last resort'

PIMFA, the Personal Investment Management and Financial Advice Association, has shared its disappointment that the Financial Conduct Authority (FCA) has confirmed plans to include discretionary fund managers as "providers", meaning they will be liable to pay for 25% of financial advisers' contributions to the Financial Services Compensation Scheme (FSCS).

Amid a funding shake-up of the UK's "fund of last resort", the FCA said respondents were generally supportive of the proposals it laid out in a consultation paper last October, although it acknowledged the "vast majority" of product providers and their representative bodies "strongly disagreed" with its proposals to have providers foot 25% of the intermediary bill alongside financial advisers. It means under the new system DFMs will be roped into the class of "providers", who are partially liable for the failure of advice firms and intermediaries when clients have lost money and are due ...