-----Original Message----- From: fsarulesok [mailto:fsarulesokaol.com] Sent: 26 September 2005 11:17 To: IFA Defence Union Subject: [IFADU List] Defect in Design - No 5 - Part 2 of 2 ........ Was Hamlet an IFA?

Evan

"Turning points" will be the central theme of this last item - Item No 5 - Part 2 of 2.

I am on a journey, what I am currently trying to establish is whether anyone else wants to join in on the same journey. You have kindly allowed me the use of the IFADU site to ask that question - thank you.

Let me repeat an extract from the remarks in Part 1: the basis of a prediction now nearly 10 years old.

1 : Income - you will not have control of it - someone else will.

2: Expenditure - you will not have control of it - someone else will.

However today I want to add two futher items to the above list, two further items over which an IFA does not have control - someone else has.

3 : Independence - as in Independent Financial Adviser - you do not have control of it - someone else has.

4 : Financial Advice - as in Independent Financial Adviser - you do not have control of it - someone else has

But perhaps I had better explain what I mean by "turning points", explain why I think Hamlet may have been an IFA, and last but not least I had better explain why items 3 and 4 are a correct statement of the obvious, at least in my estimation.

Let's start with Hamlet - he offers an insight into perhaps the most famous "turning point" ever recorded - do these words find an echo in the thoughts of many IFA's.

To be, or not to be : that is the question: Whether 'tis nobler in the mind to suffer The slings and arrows of outrageous fortune, Or to take arms against a sea of troubles, And by opposing end them?

What Hamlet asked himself, what IFA's are asking themselves, essentially narrows down to this question - "where am I going?"

Hamlet asks himself his questions, not in Act 1, Scene 1 - but in Act 3, Scene 1.

He has a past, a history, the origins of his questions lie in that past, that history.

In an identical manner the questions IFA's ask today, are not Act 1 Scene 1.

IFA's have a past, a history, the very real dilemmas they face today in the here and now, lie in that past, in that history.

I have attempted in this series of e-mails to pinpoint some of the key "turning points" in that past, in the history of the IFA as I personally experienced them at the time, the times when I criticised the decisions made, and pointed out what I saw as the inevitable outcomes - the defects in design and their consequences.

Evan, your members are I hope now able to judge whether I was right or wrong, or maybe even just in between. They can do so with hindsight, today - based on articles drawn from my yesterday.

I want to finish the list of articles with this last article, written over 20 years ago, it was a forecast of not one but many of the elements which mark out "turning points" related to both the packaged investment and general insurance markets.

http://www.probonopublico.co.uk/downloads/You_the_jury.pdf

That article, as did an earlier one mentions "polarisation". A word, but not ever a legal basis, for defining independence. A spurious independence, given to and accepted by IFAs, and now gone. As spurious as Chamberlain's piece of paper on his return from Munich.

"......Suddenly I am an IFA - an Independent Financial Adviser - because polarisation says I am, MIBOC say I am - my future independence is assured".

IFAs believed that, they were wrong to do so. This excerpt from an FSA publication for consumers confirms both "turning points".

http://www.fsa.gov.uk/consumer/11_LEARN/shopping_around/risk/prof_advice/mn_prof_advice.html

.....and if you look at the FSA Rule Book, where once there was a category for Independent Financial Adviser, you will now find these words : a) Deleted.

If you take some time and read the article closely, remember it was written in 1986, it also suggests what would happen Post Polarisation, the use of both fees and commission, forecast at a time when the very thought was sufficient to have you (in this case me) sent to the mad house as irretreviably insane.

Let me emphasise that I suggested it would happen - but and it is a big but - I did not say it was correct.

Polarisation was a defect in design, because it had no legal foundation. The position Post Polarisation is also a defect in design, for the very same reason, it has no legal foundation.

The legal foundation for independence has been with us for years, it arises under the common law.

The fact is that common law defines, and has done so repeatedly over the centuries, the legal duties to be fulfilled by someone who has a""fiduciary" duty to another, and it is the only meaningful and potentially lasting basis for defining "independence".

The origin of any right to call oneself "independent" arises, very simply and no matter how ironically, from the legal duty to be so.

You can only have the "Right" to be independent - if you fulfil the legal "Duty" to be so.

Independence - under the law - is a journey not yet travelled.

Now let's look at Item 4, Financial Advice.

Drawn from the same FSA publication to consumers, this is how the FSA define "financial advice".

http://www.fsa.gov.uk/consumer/02_HOW/Advice/mn_financial_advice.html

Just read the first sentence, the introduction and let me ask you two questions :

a) Is that definition accurate?

b) Is that definition adequate?

If your answer to both those questions match mine, then you will begin to understand why I believe there is a need for "financial advice" and a need for there to be an "Independent" source for such advice, not least so that there is an alternative for the public to turn to when they need "financial advice" other than as defined by the FSA.

It is another journey not yet travelled.

Those two factors offer the co-ordinates on a map, they show a "turning point" on a journey.

Evan, as best I can judge your members are also on a journey, but my current reluctance to commit arises for this reason.

The destination on the bus I am using says ".......and beyond".

I am on a journey, which includes many aspects of our industry, it includes the FOS, but it is "The FOS .......and beyond". I am looking for those who wish to undertake that longer journey.

At the present time, the destination showing repeatedly on the front of your bus says, A March against the FOS, and everyone associated with it.

The banner on the side of the bus reads, "Join us to fight for and obtain the Right of Appeal".

It is an important journey, in fact it is a vital journey, but is it the final destination? Do it, go there, but I don't think you should stop there.

On the IFADU bus, not by any means the only, but the most frequent shout currently heard is one of "Fraud".

Sensing this increasing clamour, just over a week ago, I asked you to pass a copy of correspondence to two of your members - off-line and in the strictest of confidence.

Those two members can affirm that the correspondence was between myself and the Head of a Fraud Unit, whose decision was to pass the analysis I had provided to the Serious Fraud Office. It related to a large scale fraud in our industry.

At the end of that correspondence - dated about two years ago - I gave the Head of the Fraud Unit concerned a prediction. I will not reveal the full details of that correspondence, and I have the assurance of both you and the two members concerned that they will not do so either.

This is an edited version - for obvious reasons - of the prediction I gave - these were the words I used :

" .........You will know that during the passage of the Enterprise Act (criminal law), the relationship of the SFO in any OFT investigation was discussed. To a very large extent it recognised the OFT as the "lookout", and the SFO as the specialist investigator, once a crime was suspected.

My very real concern in all of this is that the Regulatory Authorities, ***************************, are themselves fully aware of the "practices" to which I refer, but seem perhaps to be 100% ignorant of the law as it relates to these practices, and are establishing and indeed publishing rules to govern the insurance industry, where the rules support or collude in what may be eventually adjudged to be criminal activities. I am as convinced as I can be that this is a very real danger.

I think there is much more to come to the surface, and I suspect ****************** may just be the beginning, but the horrible irony is that those empowered by law to protect the public, may unwittingly be aiding and abetting the criminal.

Does that prediction match the criteria that many of your members are shouting about. Perhaps it does, but I remind you my journey reads " ....... and beyond".

There are crimes, and there are cover ups. Richard Nixon fell from the highest position of power imaginable, not because of the crime, but because of the cover up.

Your members may be knowledgeable, indeed many of them have knowledge way in excess of mine, but they may also be unaware of wider issues. Wider issues that run deeper than they currently realise.

From the outset of my contact, I have stated that my interests run wider, and that is why the journey will prove to be longer. I am looking for those that wish to share that longer journey into wider issues.......and beyond.

You may be right in thinking you are in a battle against Regulators (big R), but I believe you are fighting for something more important than perhaps you realise, for the regulator (with a small r), the public.

The ultimate court, the ultimate judge and the ultimate jury, lies in public opinion.

We are at a "turning point", perhaps the "mother of all turning points", there is much work to be done, and the public want that work done.

May I end therefore by thanking you, Evan, and all of the IFADU membership for the courtesy and kindness shown to me - particularly so in that I was an unannounced guest.

There is vital need for IFADU, as a source of collective action, as a source of mutual support, and even as a chat room. I am confident that the IFADU will win their battle. Justice sometimes takes a long time to surface, but it does always prevail - good luck.

To all - I wish to close by copying something Evan does, he ends all his correspondence with something Churchill once said, here is something Churchill also said ........

NEVER GIVE IN, NEVER, NEVER, NEVER.

Mike Fenwick .... Note: This list allows you to share information and documents with everyone else on the list, if you don't want the email press 'Delete', if you want to set a folder up for these messages use 'IFADU List' in the rule to move it to that folder. If you unsubscribe from the pesky junk email that pays for this service you unsubscribe from the list so beware, if you do this by mistake can resubscribe by sending an email to ifadefenceunion-subscribedomeus.co.uk