On the joy of not failing

Regular readers of this Blog will be aware that I spend a disproportionate amount of my life attempting to understand, and respond to, the strange kinds of judgements delivered by the FOS.  When I was a little boy at school, wondering what I might end up doing with my life (rocket-scientist?  brain-surgeon?), this form of mind-numbing incomprehension would never have occurred to me.  In fact, I cannot think of a vocation for which one might summon up less enthusiasm than this one, yet (of course) someone has to do it - and, in some strange way, it seems as if I might almost be equipped for the job.  The frustration lies not in the volume of complaints (we have relatively few, but they do seem to arrive together, like buses), but rather in the nature of the process, the kind of interaction which then ensues - for it is tortuous, and defies the kinds of 'normal' rules of logic by which we think that we apprehend reality.  When one attempts to unravel the points of discontinuity between FCA and FOS, one enters a zone where the laws of Quantum Physics apply, where quite different pictures of reality morph alarmingly, where the old Newtonian certainties have faded away, leaving a wry smile hanging insubstantially in mid-air.

This may simply be a byproduct of the ageing process.  Past experience encourages one to expect certain components of rationality to apply in any context where one might anticipate some kind of diversity of view.  Perhaps in conjunction with the Brexit negotiations, or government immigration policy, or in relation to the whole spectrum of single issues which motivate people to shriek at other people on social media, or in relation to the relentless storm of ad-hominems which now appear to frame the character of public discourse.  One makes the assumption that the FCA's culture of 'principles-based regulation' results in the application or outworking of ...er...'principles', but in practice what one encounters is a kind of Humpty-Dumpty-esque partisanship where anything might actually mean anything else, other than the anything we might have expected it to mean.

Inevitably, these discoveries temper one's expectations of how things are likely to turn out.  You scale back your optimism over the significance and efficacy of documented 'truths' or verifiable facts in client files, because you learn in practice that, when the pathology is all about redress, then these matters tend simply to be inconvenient obstacles in a process which proceeds in a straight line, like a runway steamroller, bulldozing its way through a field of wheat.  You learn instead to concentrate on what is not said (the omissions within a client file), because one has become impressed by the ability of adjudicators to extrapolate whole worlds from silence, preferring the creative potential of such an approach, to the somewhat more pedestrian consideration of known data.  And, of course, after a while a kind of spiritual disquiet sets in, prompted by those profound cultural discontinuities between FCA and FOS - for these have the potential to radically subvert one's belief in principles, or specific regulations, or that thing which we like to call 'best practice'.

Having seen examples of unquestionably excellent advice and client service attacked by opportunists, and aided and abetted by the FOS, this experience can do no other than reframe our own expectations of how things are likely to work out.  ValidPath Members should know by now just how much pride I take in their client-focused ethos and professionalism - somehow, via some arcane process, we have built a network of likeminded professionals, a kind of unity of excellence that one rarely encounters elsewhere.  My own job doesn't get much better than when I get to review exquisitely-compiled pieces of independent financial-planning work, where everything is joined up, and where the documentary narrative sustains throughout an unwavering focus on the client's best interests.  But when I sign off those file reviews with a 'PASS' I am under no illusion that, in the present culture, that will mean anything at all to the pursuers of redress.  No, my satisfaction lies in these cases not failing.

This week, we have handled twenty-four 'full-fat' file reviews.  The good news:  not one of them failed.  

This week's key compliance update

We've written a new update to the subject of client risk-assessment, focusing on the three components expected by the FCA, and highlighting the three strongest possible solutions to support the Adviser's role.
Kevin Moss, 22/09/2017