Hello, it’s Nat here, feeling both distinctly Autumnal and that September is hurtling by at a rate of knots. Oh for the days when the South Cats among us were wondering whether we were on heatwave #6 or #7 and if our lawns would ever recover to the green and pleasant land status for which they are famed. And people say we don’t have real problems… 

Anyway, I digress. I am going to take this opportunity to indulge my inner regulatory geek. Specifically, I want to give a bit of room to a speech given last week by the FCA’s Kate Tuckley, head of department for consumer investments. 

Speaking at Verve’s Transformation conference in London, and hot on the heels of a cartwheeling Power Ranger (as you do), the regulator gave a few updates on timings for things and called out a couple of areas that I think are worth spending some time on. 

In the first camp, here are a few things to mark your regulatory card for: 

• The FCA is progressing its review into the MPS market, which among other things is looking at how MPS providers are implementing Consumer Duty. Originally tabled for this summer, the regulator says this is still on track for the new release date of Q1 next year. 

• Another Consumer Duty-related multi-firm review, this one on support for bereaved customers and clients, is due to publish its findings later this year. It focuses on ‘consumer investment firms’, including platforms, advisers and wealth managers.  

• Transfers. Kate Tuckley said: “We want to significantly move the dial on transfer times.” Somewhat ironically, no timing was given for that, but amen to the principle (said mostly everyone).  

Those are the headlines. But for me the more interesting parts of the speech related to what I’d loosely term “changes to the advice framework.” 

Chief among these is the one we all know about, targeted support. Nine firms are now authorised to deliver targeted support, and it’s likely more are waiting in the wings. Like everyone else no doubt, I am interested to see what these services will look like in practice. Will they keep consumers in the process for long enough to actually get them to take action in a way they wouldn’t have if targeted support didn’t exist? 

The regulator talked about other rules being developed in parallel: final rules on simplified advice (déjà vu) by the end of the year; changes to ongoing advice; and a review of the financial promotion rules next year.  

The emphasis was on enabling firms to “deliver more flexible advice services”. Kate Tuckley said: “We are deliberately trying to move away from the cliff edge” of full advice and no advice. 

The very wise Rich Mayor has pointed out previously that things are afoot in the world of D2C which could spell trouble for the advice market we know and love. He expounds on this further in his latest set of predictions for the advised platform market (it’d be rude not to mention Analyser subscribers can read more on this in the latest edition of the Special Section). 

All of that is to say that things are showing signs of shifting already for advice professionals and advised platforms, and the regulatory agenda suggests more change to come.  

At the same time, and talking of the ground shifting under our feet, the spectre of AI looms ever larger. The panic alarms around AI have been blaring particularly loudly over the past week or so (see here and here, and the usual helpful contribution to the debate from Donald Trump here). 

Back in financial services, Kate Tuckley also talked about the concerns the regulator has around AI. She explained how the use of LLMs by consumers for advice-like queries “tests the regulatory perimeter”, and reiterated there’s no regulatory protection from the likes of the FOS and the FSCS with this stuff, and the regulator doesn’t want consumers to assume otherwise.  

Sheldon Mills, who led a review for the regulator on AI and the future of retail financial services earlier this year, has highlighted the same concerns, though perhaps in stronger terms. He admitted he was worried about AI activity happening outside the FCA’s remit. Quite apart from the risk to consumers, he said there was a risk that the regulator would end up having to explain itself to Parliament on a weekly basis, saying “we told you we didn’t have the powers for this.”  

Handily, it is these concepts around the role of AI in advice that we want to explore at HomeGame 6 next month. We are already hearing anecdotally about AI search results being just as if not more important for finding an adviser, regulated advice being ‘cross-checked’ by the likes of ChatGPT, prospective clients questioning advisers in a suspiciously templated fashion, and IHT reports and tax calculations being done by AI. Some of these outputs are said to be surprisingly good, and others contain pretty glaring errors and outright wrong answers.  

So we will get into all of that and more come 7 October. What do clients actually see when they ask ChatGPT, Claude, Gemini et al for advice? What does AI-enabled advice look like from the advice professional’s perspective? And what do the answers to these questions mean for how advice and planning might look in the future? Come and join us as we try to find out. 

Your music choice this week. After dividing the crowd with my last pick, and having to field questions about the lyrics (hat tip to James Cole at Talis IFA for that 😊), hopefully I’m on safer territory with this one. For those of us trying to recapture the magic of Summer, sit back and relax to Slip Into Something More Comfortable from Kinobe. “Try the silence on for size” sounds quite appealing right now… 

Nat