British regulatorsannounced today that they are going to ban financial advisers from accepting commissions for selling mutual funds and other financial products. After 2012, advisers will instead have to charge directly for their services.
The Financial Services Authority said this move would help restore consumer confidence in the investment industry, following a series of mis-selling scandals where commission-driven advisers apparently induced large numbers of investors to switch to inappropriate products.
With mutual-fund commissions and trailer fees now to be eliminated in Britain, could Canada be far behind? In my opinion, the pressure to end the commission-based model of financial advice does appear, as of today, to havereached a tipping point — especially considering U.S. regulators are now investigating U.S. mutual fund fees and could similarly decide to end embedded commissions.
News report from the Guardian.
Hat tip to Vikash Jain of archerETF
Blogs & Comment
Mutual fund commissions banned in UK
By Larry MacDonald
British regulatorsannounced today that they are going to ban financial advisers from accepting commissions for selling mutual funds and other financial products. After 2012, advisers will instead have to charge directly for their services.
The Financial Services Authority said this move would help restore consumer confidence in the investment industry, following a series of mis-selling scandals where commission-driven advisers apparently induced large numbers of investors to switch to inappropriate products.
With mutual-fund commissions and trailer fees now to be eliminated in Britain, could Canada be far behind? In my opinion, the pressure to end the commission-based model of financial advice does appear, as of today, to havereached a tipping point — especially considering U.S. regulators are now investigating U.S. mutual fund fees and could similarly decide to end embedded commissions.
News report from the Guardian.
Hat tip to Vikash Jain of archerETF