And there's more, folks... 


It is a little over five years since the RDR ushered in new de-minimus qualifications for financial advisers, and since then those of us who have the required QCF Level 4 accreditation, do what is necessary (and probably beyond) in order to satisfy the minimum annual requirements for relevant CPD.

In theory, at least,  this ought to be sufficient.  We have a baseline level of competency, which may be periodically augmented in order to underpin specific kinds of service, and which is maintained, or topped-up throughout the year in order to ensure its currency or relevance.  Clearly, this is not enough, for this week we have seen headlines such as this and this, regarding a new joint initiative between the FCA and the PII.  We are told that, from the 1st October, there will be a brand-new Regulated Retail Investment Adviser Re-Evaluation assessment made available to financial advisers, which will be supplementary to the current framework governing the issuance of new SPSs.  This seems awfully short notice to be announcing a development which has such ramifications for the existing T&C framework.

The good news is that the RRIARE is not (yet) compulsory.  The bad news is that we have yet another acronym to contend with, and there is a suggestion that advisers who choose not to take this supplementary test could well be targeted by the Regulator for further attention.  As usual, the articles published on the subject receive plenty of howls of outrage in the 'comments' section, and one cannot but help think that some of these are justified.  After all, the introduction of yet another assessment implies that what we have been doing on the CPD front over the last few years is not fit for purpose - why not, for example, just beef up the T&C regime?  Or why not abandon it completely if you're going to introduce an ongoing assessment?  It seems an odd decision to maintain an existing framework whilst implying (through the introduction of the new RRIARE) that it is not satisfactory.  As usual, the nature of media reporting tends to hinder one's attempts to get at the truth.

Perhaps there is something else going on here.  Perhaps the FCA is aware of cases where advisers are cooking the books when it comes to CPD, or where perhaps the CPD they are obtaining is of an inadequate quality, or perhaps is too ad-hoc to be relevant to the adviser's actual role?  Or perhaps there are, in practice, problems with the actual balance between structured and unstructured CPD?  Certainly, my own kind of role results in the accrual of several hundred percent of the actual target for unstructured CPD, because of the focus on compliance and regulations.

How might we constructively respond to this kind of news?

  • Brace ourselves for more detail.
  • Improve our familiarity with the kinds of systems and approaches which bring all of our technical knowledge into one point of focus - such as CashCalc's cashflow forecaster, or DeFaqto's goals-based investment modeller.
  • Put in some additional work on our T&C plans.
Clearly, this is a significant new development - please expect further commentary and ideas from ValidPath.
Kevin Moss, 06/09/2018