Aegon backs reforms amid £20,000 compensation payout

WIDE-RANGING reforms of investment sales and advice will give the industry the chance to “do the right thing” for customers, Edinburgh-based Aegon has claimed.

The Financial Services Authority’s retail distribution review (RDR), coming into force in 2013, will change how financial advice is accessed and paid for. It includes a ban on the commission paid by providers to financial advisers for selling their products.

Paul McMahon, group marketing director at Aegon UK, warned that implementation of the controversial reforms would be challenging.

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“There’s inevitably a significant degree of angst when so much change has to be managed, but we must never lose sight of the original reason for the RDR – the critical need to address fundamental weaknesses in our industry model and establish a sounder foundation to address the levels of distrust, disengagement and under-provision prevalent amongst UK consumers,” McMahon said.

His comments came as Aegon was told to pay almost £20,000 in compensation to a customer after a delayed transfer of funds caused him to miss out on an National Savings & Investments bond offer. The pensions ombudsman said the firm had also provided inconsistent fund valuation figures and misleading information about the customer’s investment.

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