Treasury Committee asks for review into pre-approved products
The Treasury Select Committee has called for the Financial Services Authority successor, the Financial Conduct Authority (FCA), to hold a review into pre-approved products.
The Treasury Select Committee recommended the FCA conduct a review of the merits and costs of a pre-approval scheme for financial products, including funds.
The report adds: “We also recommend that the FCA reconsider the scope for distinguishing in regulation between simple products which can be pre-approved for basic needs and more complex products, generally but not always more suited to sophisticated investors, which cannot.”
Providers had called for a “simplified product range of key builiding blocks” to make up the core of savings for “vast majority”.
The range “could include simple cash products, personal pension plans, index linked and other savings bonds, gilts and ISAs holding some very basic equity funds”.
However, the proposals have met with resistence from the Mark Hoban, financial secretary, and Martin Wheatley, chief executive-designate of the FCA, highlighting resources and innovation issues, respectively.
The committee found that there had been no evidence to justify a recent u-turn by the Financial Services Authority to consider pre-approved products.
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