§ Ms. MowlamTo ask the Secretary of State for Trade and Industry if he will bring forward proposals to make companies providing financial services liable for losses resulting from poor or misleading advice given by independent intermediaries who market the products of a small range of companies.
§ Mr. RedwoodIndependent advisers are responsible for the advice they give, and their conduct of business is subject to rules made under the Financial Services Act.
§ Ms. MowlamTo ask the Secretary of State for Trade and Industry (1) what discussions he has had with the regulatory bodies about the classing of the sale of home income schemes to elderly people as best practice under the terms of the Financial Services Act;
(2) if he will issue advice directly to elderly persons to draw their attention to the risks associated with entering into home income schemes;
(3) what consideration he has given to introducing controls on the sale of home income schemes to elderly people.
§ Mr. RedwoodThese are matters for the regulatory bodies. I understand that the Financial Intermediaries, Managers and Brokers Regulatory Assocation and the Life Assurance and Unit Trust Regulatory Organisation have issued guidance to their members.
§ Ms. MowlamTo ask the Secretary of State for Trade and Industry what steps he proposes to take to ensure that sufficient information is available to the public to clearly explain the distinction between tied and independent agents.
§ Mr. RedwoodThe Securities and Investments Board and the self-regulating organisations, such as LAUTRO20W and FIMBRA, are responsible for making and enforcing rules on these matters under the Financial Services Act. The distinction between tied agents and independent financial advisers is important and I refer to the answer given by my right hon. Friend the Secretary of State to my hon. Friend the Member for Colne Valley (Mr. Riddick) on 7 December 1990, at columns 223–24.
§ Ms. MowlamTo ask the Secretary of State for Trade and Industry if he will bring forward proposals to require tied agents to disclose commission on products in the same way as independent agents.
§ Mr. RedwoodThe Securities and Investments Board and the self-regulating organisations, such as LAUTRO and FIMBRA, are responsible for making and enforcing rules on such matters under the Financial Services Act. On the general issue of disclosure, I refer to the answer given by my right hon. Friend the Secretary of State to my hon. Friend the Member for Colne Valley on 7 December 1990, at columns223–24.