Warning firms may have to cover losses outside poor advice

Currently if a financial services firm breaks FSA rules when providing advice, they are only liable for compensation for losses directly arising from that advice. However, in its evidence to the Joint Committee on the Draft Financial Services Bill, the FSA has argued for a change to causation law which would allow its successor, the Financial Conduct Authority, to force firms to pay compensation for 100% of losses. Such a change would make financial services firms liable for 100% of losses, not just those arising directly from faulty advice, Reynolds Porter Chamberlain (RPC) says. ...