The Association of Private Client Investment Managers and Stockbrokers is deeply concerned that their members are being asked to pick up the tab for banking failures.
Fees increases announced by the FSA yesterday have hit private client wealth managers and stockbrokers most of whom will face increases ranging between 10% and 40% depending on the size of the firm and the business mix. The only justification for the increase given in the FSA's consultation paper refers to the additional resources needed to enhance the supervision of the banking sector.
Ian Cornwall, Director of Regulation at APCIMS said:
"The FSA has failed to provide adequate information to justify the precise increase in the fees. The lack of analysis and information within the FSA's business plan and consultation paper on the proposed fees leaves our members unable to understand why such vast increases of fees have been proposed for their business.
"It is important that the regulator understands that the private client and stockbroking sectors have entirely different business models from the banking sector. Given the risk levels are considerably lower in our sector we should not be picking up the tab for banking misdemeanours.
"We also note that historically the FSA has increased fees in order to invest in IT and systems but they have failed to demonstrate whether the systems are in place and are delivering. This is an outrageous lack of accountability which must be challenged.
"If the FSA expects to hold the confidence of the Financial Services sector in the UK it must demonstrate to firms that it is only charging for the resource required to regulate their sector. The regulator must also show that it understands the differences within UK financial services and that it treats each sector appropriately."