At last, truly independent financial advisers

The Financial Services Authority ban on independent financial advisers accepting commissions from product providers is good news for consumers and should create more genuinely independent financial advisers.

It's been a good week for consumers. Under new proposals from the Financial Services Authority (FSA), independent financial advisers (IFAs) will no longer be able to accept commissions from product providers after December 2012. Instead, IFAs will agree upfront fees for their advice. The FSA is aiming to put paid to 'commission bias'.

The trouble with the current approach is that despite protests to the contrary consumers are often sold products that pay advisers the highest fees, rather than those that are most suitable. For example, investment bonds offered by life companies pay up to 8% commission, "and what do you know, these bonds get offered left, right and centre", says Alice Ross of FT Money.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up
MoneyWeek

MoneyWeek is written by a team of experienced and award-winning journalists, plus expert columnists. As well as daily digital news and features, MoneyWeek also publishes a weekly magazine, covering investing and personal finance. From share tips, pensions, gold to practical investment tips - we provide a round-up to help you make money and keep it.