The Middle East’s first financial advisory aggregator site, which aims to protect consumers from cold calling advisers and scammers, went live on Wednesday.
The site whichfinancialadviser.com (WFA), set up by research and communications company Insight Discovery, lists advisory firms regulated by two of the UAE's regulatory authorities – the UAE Insurance Authority and the Securities and Commodities Authority.
“It can be daunting for consumers to understand how they are protected by the different regulatory frameworks here in the UAE and WFA helps to cut through all of that and provide simple and straightforward information on regulated firms here in the UAE,” said Nigel Sillitoe, founder of the comparison site and chief executive of Insight Discovery. “Soon, we plan to roll out WFA in other markets in the Middle East where financial advisers are regulated by the competent regulatory authorities.”
Mr Sillitoe said WFA will not highlight advisory firms that cold-call residents in the UAE to drum up more business and added that a separate site will soon be launched to highlight wealth managers - who typically manage the assets of those with more than $500,000 to invest - regulated by the Dubai Financial Services Authority, Abu Dhabi Global Market and Central Bank of the UAE.
Earlier this year, the Insurance Authority issued a third draft of its proposed overhaul of the life insurance sector on its website to improve how savings, investment and life insurance policies are sold. The authority started the process in 2016, stating at the time it had received "an alarming number of complaints" from residents mis-sold long-term savings products – provided by global insurers and distributed by IA-licenced financial advisers.
According to February's Middle East Investment Panorama study from Insight Discovery, 39 per cent of UAE residents believe better transparency on fees and commissions would improve the industry’s image, while 37 per cent demanded a crackdown on scams and unregulated firms by regulators.
The new website will include information on the local regulators, the different types of licences and links to professional bodies so that residents can check whether their financial adviser is a member.
Mr Sillitoe said the private venture is monetised by allowing regulated firms to be profiled on the site for an annual fee. The company also receives income from professional bodies and service providers with "a vested interest in developing and professionalising the sector".
He added that the site will remain independent by removing suspended firms from the site and not profiling cold-calling offenders.
"If a cold-calling firm is regulated we cannot exclude them from being listed however we can stop them from being profiled, unless of course they can prove to us that they have stopped this practice, which is damaging the reputation of the industry," Mr Sillitoe said.
Gordon Robertson, director of financial advisory group InvestMe Financial Services in Dubai, said WFA should provide investors with helpful information about qualifications and where to complain to.
"If truly independent it will give an unbiased information resource to investors," he added. "However even armed with such information, one should not get too complacent."