11:16am UK, Wednesday August 06, 2003

The vast majority of successful complaints against financial advisers relate to those tied to a particular product-provider, figures show.

Last year, tied advisers were involved in 90% of upheld complaints about mis-sold endowments and 88% relating to other investment products.

That compared with 10% and 12% for independent financial advisers (IFAs), according to the figures from the Financial Ombudsman Service.

And the 9,722 complaints upheld against tied advisers in 2002-03 were 80% up on the 5,394 in the previous year.

Dangers

The figures highlighted the danger of plans which he said would water down the independence of IFAs, the LibDem's Vince Cable said.

The FSA is considering proposals to end the "polarisation" rules which currently require all financial advisers to be either wholly independent or tied to a single product-provider.

Mr Cable obtained today's figures through parliamentary questions to Treasury minister Paul Boateng.

Folly

"With this level of complaints, it is utter folly for the Government to drive customers into the arms of tied advisers.

"Some tied advisers are clearly wolves in sheep's clothing.

"Consumers should be extremely alarmed that the FSA is insisting on removing the rules which govern the independence of financial advisers.