Alongside the new strategy, the FCA published its consumer investments data review, highlighting actions taken between April 1 2020 and March 31 this year to tackle harm. It reports that 48 companies were prevented from gaining access to the market, where it had identified potential for consumer harm – a figure representing one in five applications.
It had also opened more than 1,700 cases involving scams or higher-risk investments and published more than 1,300 consumer alerts about unauthorised businesses and individuals.
While acknowledging that the new measures announced are a positive step, there is some doubt that all of the targets are achievable.
“Any additional help to identify and reduce scams has to be welcomed,” says Keith Churchouse, director at Chapters Financial.
“Some of the specified targets appear reasonable, such as reducing cash holdings by 20 per cent, while others, such as halving the number of investors in high-risk products, will be difficult to achieve, even by the end date of 2025.”
Churchouse is not convinced that the FCA has gone far enough: “The reason why consumers seek advice is because they want to place their trust in advisers, in part because understanding the opportunities within the advice arena can be daunting. I hope that the suggested regulatory changes will help this process, although the devil will be in the detail and delivery.
"However, £11m in a campaign to recognise high-risk investments is unlikely to go far.”
Glassey also says there is more to do, adding: “We should aim for the public to become as sceptical of DIY investment strategies as we are of shunning medical expertise and turning only to the internet for our medical advice.”
Fiona Nicolson is a freelance journalist
