# Raipis and Advertising



## Brendan Burgess (28 Jan 2002)

There is an ad in today's Sunday Tribune announcing the launch of Prima.finance.ie by the Tánaiste.

There is no mention that the firm is a RAIPI. 

What is the Central Bank position on this and if it is illegal, to whom should I complain?

Brendan


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## Mary Kelly (28 Jan 2002)

*Advertising*

Presumably you have to go online to deal with this firm? I didn't see the article. Were there contact numbers?

Their home page [broken link removed] states that they are RAIPIs.


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## Sumatra (30 Jan 2002)

*Web Sites*

Brendan,

Talk about CB and consumer confusion!

You can have a web site thats RAIPI and within this site you can act as a 'Tied' agent for certain products! (not supposed to happen but there you are - never thought of that one).

Personal belief - impossible that you can give AA status to a web site.

ps. above comments do not refer to permafince.

RGDS,

Sumatra


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## Personal experience (31 Jan 2002)

*Websites*

Hi, this is not a theory. My company sells mostly over the web, and we've invested a lot of capital to do so. New regulations mean that we cannot trade as AA, and describe ourselves as independent. We've been, essentially, instructed by the Central Bank to drop the AA application.


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## Liam D Ferguson (31 Jan 2002)

*Re: Websites*

Interesting one, this.  While I chose RAIPI status for my own firm for various reasons (which I've banged on about for ages and so won't bore anyone by repeating   ), I'm not sure I understand why the CB would object in principle to a web-based AA.  If the site is set up to give a customer details about <!--EZCODE ITALIC START-->_ all_<!--EZCODE ITALIC END--> the relevant products in the market and can sell the customer any of them, (having completed a suitable online factfind), I wonder where the problem lies.  It would be an impressive site (and I daresay an expensive one) but why not?


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## rainyday (1 Feb 2002)

*Re: Websites*

<!--EZCODE QUOTE START--><blockquote>*Quote:*<hr> We've been, essentially, instructed by the Central Bank to drop the AA application<hr></blockquote><!--EZCODE QUOTE END-->

I'm sure they can't really instruct you to drop the application. They can definitely refuse the application when it is made, but they can't actually stop you making the application. If they are trying to influence to you stop applying, I could only assume that they would feel 'on dodgy ground' about refusing it.


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## Personal experience (1 Feb 2002)

*Reason*

Hi Liam, I saw your stuff in the newspapers at the time. But unfortunately, you are wrong on your interpretation. This is because the Central Bank are focused on broad based advice, and how it is delivered. You see it as a product selection issue only. 

The problem is that a website is a poor place to fulfill 'Know Your Client'. Rules based financial advice, tied up in software programs is too limited, to qualify, as broad based advice.


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## Brendan Burgess (1 Feb 2002)

*Re: Reason*

I spoke to the Central Bank about the ad and they confirmed that they should have mentioned that they were a RAIPI in the ad. They will follow it up with Prima.

It's interesting that a website can't be an AA and must therefore be a RAIPI. 

I checked with solmon.com and they have it on their website that they are an authorised advisor. However, they have no information on investments products on their site anymore.

Brendan


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## Liam D Ferguson (1 Feb 2002)

*Interesting...*

Hi PE, 

I see.  So by the same logic, (execution-only provisions aside) presumably the CB would frown on an AA firm, for example, mailshotting potential clients about SSIAs unless a broad factfind was completed with each one?  Wonder will this mean that AA firms won't bother selling SSIAs as the requirements would be too time-consuming for the amount of remuneration on offer.


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## rainyday (1 Feb 2002)

*Re: insure.ie*

I note that  are claiming to be 'Authorised Advisors' on their website. From their 'About Us' page;

"insure.ie is the trading name of Newsure Ltd and is regulated by the Central Bank of Ireland as an authorised advisor"


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## Sumatra (1 Feb 2002)

*One Direct - Status*

Here is One Direct's Status -

One Direct is regulated by the Central Bank of Ireland as a Restricted Activity Investment Product Intermediary. One Direct is a trading name of An Post Direct Limited. Registered in Ireland 299000. Registered Office: GPO, O'Connell Street, Dublin 1. 
An Insurance Agent for Friends First Life Assurance Company Limited, Hibernian General Insurance Limited, Mapfre Asistencia Agency and New Ireland Assurance Company plc. A credit intermediary of Bank of Scotland (Ireland) Limited.

RGDS,  Sumatra


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## Conan (2 Feb 2002)

*Restricted intermediaries*

A response to Liam D's comment.
There is no problem with mail-shotting potential clients on any product, whether you are a RAIPI or an AA. The point is that if the business is not transacted as "execution only", then a full fact-find must be completed as part of Central Bank regulations.
Regarding whether web-based sites can trade as RAIPI's or AA's, I suspect that some such organisations may have APPLIED to Central Bank to act as AA's but that they still only "stand authorised" until CB get around to deciding their status. I would not be surprised if they are "encouraged" to reapply as RAIPI's following CB examination.


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## Personal experience (2 Feb 2002)

*Sorry*

Sorry to be a bore, but a lot of this stuff is pure speculation. It's not until you go through the wringer that you understand the nature of the AA requirement by the CB. Most of the 900 AA applicants, are just that, they are applicants. Only a handful of firms are Section 10 authorised.

Liam is close to getting the point. You cannot give broad based advise from the type of rules system that websites use. A general circular that advises about SSIA's, and elicits a response cannot be classed as Execution Only. It simply can't. It would only be such if the person took your advice and transacted free of advice through another firm.

People in the industry are still looking at the regulations, like I too did, reading them the way we want to.


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## question (2 Feb 2002)

*What's the definition of an authorised adviser?*

What's the definition of an authorised adviser?


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## Mithrandir (2 Feb 2002)

*Execution Only*

If you've product recommendations, ie selections and the like on your website, in your brochure, or issued by circular, and a browser/reader contacts you to undertake a transaction on the basis of what he or she has read that you produced, is NOT execution only. A full written factfind etc is required, and inevitably human interaction.

That's why websites are in difficulty under AA rules. I recently had a request from two partners, each with his own IT company for advice on company pension schemes. They wanted to conduct business purely by email. Suited them. Under the rules I could not advise without a factfind, which is really only workable by human contact ie by phone at least. Otherwise people leave stuff out, or I miss vital qualitative information, like I'm separating, I'm in a wheelchair, I'm thinking of going to Australia next year. The type of stuff DIY Personal finance Books can't cover. The cracks.

Anyway after several failed attempts to talk I had to tell the guys to go elsewhere. By email.


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