IFSRA and Whistler

On page 19 of today's Irish Times, there is a snippet about IFSRA warning that people should not deal with Whistler Managers Ltd who have been offering advice in Ireland although they are not authorised to do so.

It quotes Ms Mary O'Dea, IFSRA's Consumer director

"the bottom line is that if something sounds too good to be true it usually is"

Surely on those grounds alone any bond offering double or quadruple growth should be banned?

Whistler

too good to be true

"the bottom line is that if something sounds too good to be true it usually is"

I think they will have to change that phrase.

List anything that sounded too good to be true but wasn't.

Ryanair flights for example?

Re: too good to be true

Whistler,

I based my initial, informal complaint to IFSRA about the Quadruple Growth Bond on the exact premise that it is too good to be true. I didn't need to do any analysis. No one can offer 4 times the growth in stocks. Without reading the brochure, I knew it was misleading.

It seems that IFSRA's brief is not to distinguish between good products and bad products. But they cannot escape from their responsibility to stop financial institutions misleading customers.

If a consumer takes out a loan from AIB at 9% and puts it on deposit with Bank of Ireland at 1%, then IFSRA can and should do nothing about it. But if ACC or Irish Life and Permanent, encourage customers to do this by dressing it up as a geared tracker bond, then IFSRA should stop them.

IFSRA is quite limited in its actual powers by the current legislation. But I remember Arundel's (?) Business Organization book for the Leaving Cert in 1974. When discussing the role of the Central Bank, it said that the Central Bank achieved many of its objectives by "moral suasion". I will see if I can find a copy of this book and send it into IFSRA.

Brendan

Re: too good to be true

Actually, I don't need to root around in my attic, moral suasion is alive and well, though google suggests that it popular in Central Banks only in Australia and the Bahamas

Brendan