What happens when a client wants to act against his advisor's advice? The UK's Financial Services Authority is attempting, with partial success, to lay out some procedures without bothering to enact rules.

The regulator's rulebook or 'handbook' has nothing to say about situations in which customers refuse to take advice and want to go their own way. In a recent 'factsheet' (No 035) the FCA does not say why this is. It does, however, try to define the (as it sees it) problem because it fears trouble looming in the light of April's pension reforms.

"There may be occasions where the client wishes to take a different course of action from the one you recommend...they are commonly referred to as an insistent client."

It recommends three steps for the advisor to take when advising an insistent client.

1. He/it must provide advice that is suitable for the individual client and make it clear. This is the normal advice process.
2. He/it should leave the client in no doubt that their actions are against his/its advice.
3. He/it "should be clear with the client what the risks of the alternative course of action are."

If the advice includes a pension transfer, conversion or opt-out, the regualtor says, somewhat indecisively, that there may be additional requirements such as ensuring the advice is provided by or checked by a pension transfer specialist, comparing the defined benefit scheme with the defined contribution scheme and starting by assuming the transfer is not suitable. The only part of its rulebook to which it refers is COBS 19.1R. This deals with pension transfers and opt-outs.