The fight against regulation begins

The campaign against mandatory commission disclosure and tighter regulation took off this week, with Biba spearheading the search for a market-led solution and the revelation that the FSA is set to meet concerned industry bodies.

Last week, Biba wrote to its brokers to gauge how willing they would be to disclose all commissions under a voluntary scheme.

In a separate development, the FSA confirmed that it was thinking of holding a summit with the industry on the matter next month, though it said no agenda had been set.

Biba’s questionnaire asked members about their willingness to use a set template for disclosure if one were devised. Steve White, head of compliance and training at Biba, said: “The FSA had made it clear it expects to see certain outcomes. This includes commission disclosure throughout the distribution chain. We are finding support for the key ingredients. What brokers say they are willing to do and what they do in practice may be different.”

He added: “Any model [for a market solution] would use Biba’s Toba wording [which reminds commercial customers that they are entitled to ask for details of a broker’s commissions]. The trick is to get everyone to accept the solution. There is an appetite for a market solution, but there is much to be done.”

Next month’s proposed meeting with the FSA is believed to be a response to the first wave of industry feedback to the discussion paper. It is thought that the regulator is already concerned at the rate of responses from worried brokers, to the paper it issued on March 20. The FSA refused to comment on responses.