The English ICA began a desperate rearguard fight yesterday to stave off regulation by the Financial Services Authority of members carrying out investment business.
Senior executives at the institute were due to meet officials from the FSA and the Treasury as part of the campaign which aims to wrest back supervision powers handed to the FSA by chancellor Gordon Brown last year.
Accountancy Age understands that executives at the chartereds’ Moorgate Place HQ were furious when they were told they would lose powers next year to regulate up to 4,700 firms currently registered to conduct investment business.
The meeting yesterday was set up to thrash out important issues prior to a formal discussion on October 16.
ACCA, the Scots ICA and Irish ICA, have also lobbied hard to reverse plans put forward by the Treasury that would lead to a large swathe of their members being regulated by the FSA. ACCA officials are due to meet FSA and Treasury officials later this year.
The argument centres on a series of definitions which were outlined by the Treasury in documents sent to the professional bodies earlier this year. Both the institute and ACCA have written lengthy replies, but have so far failed to convince Treasury officials to change their minds.
The Treasury wants to include ‘non-discreet’ investment business under the FSA umbrella. The professional bodies argued that non-discreet business does not involve accountants recommending specific financial services products and should therefore stay within their control.
If the Treasury has its way, the 1,240 chartered firms conducting non-discreet investment business would be regulated by the FSA along with the 700 firms currently acting as fully fledged financial advisers. Another 2,700 register as a precautionary measure.
Anthony Booth, head of professional standards at ACCA, said the aim was to end the burden on accountants that are forced to register as a precautionary measure. ‘But trying to draw a tidy line is proving very difficult. The trouble is, if there is any doubt, then practitioners will seek to register so they don’t get caught out,’ he said.
The institute is also concerned that its members will vent their anger against its own officials for carrying out FSA policies when the new rules come in next year.
The institute was unavailable for comment.
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