In the June issue of RISKAfrica magazine, Fiona Zerbst sits down with David Kop, head of Stakeholder Engagement at the Financial Planning Institute of Southern Africa, to chat about some of the possible implications of the COFI Bill and its likely impact on financial advisers.
David explains that the COFI Bill is the first in a new line of legislation which is not fully rules-based but principles-based. The policy position is quite clear he says, the aim is to move towards a sustainable financial services sector the consumer can trust – and it states that regulation needs to be proportionate. There’s obviously a lot less risk attached to a small intermediary firm that doesn’t hold assets for a client, so to suggest the firm should be subject to the same solvency requirements as a large insurer holding assets doesn’t make sense. The proportionate functionality of COFI Bill is great.
David agrees that there is still a lot of work to be done. The FPI’s viewpoint is that while there is quite a lot of information available, it’s really anticipating the conduct standards that have yet to be drafted. It gives authority to the Financial Sector Conduct Authority (FSCA) to draft the standards and a lot of clarification will be achieved in those detailed standards. David adds that while he knows the hope was that it would be presented to parliament later this year, he expects that we will see another round of consultations, especially if feedback on the initial draft is quite significant.
To read more, download the June issue of RISKAfrica.
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