Times, they are not changing in some quarters

I was interested to receive an e-mail this morning that shows how times are definitely not changing in some quarters. The advert, aimed at financial advisers and financial planners, announced a “new range of high yielding products your clients will love, with a minimum 10% commission”; the sub-headline is “a great commission while offering all your clients want: guaranteed performance.”

Further on, the ad offers “ industry leading commission at the same time guaranteeing your client’s investment”. It then states that this is “an innovative investment vehicle producing outstanding customer returns which is, amongst other things

• authorised for use in SIPPs/SSASs (ideal for the pension transfer market)
• guarantees capital and income for your clients throughout the term
• is underpinned by high yielding assets world-wide
• is managed by a select few FTSE 100 companies."

Questions for discussion and consideration:

How can any company still be selling products based on a 10% minimum commission payable to the introducer?

Has this company not heard about the FSA’s proposal to abolish commission (the ad also offers introducers a unique client re-investment programme, creating you a residual commission)?

Does this company not understand that high yield equates to high risk?

If this company is guaranteeing what is in effect a higher yield, higher risk investment what is the cost of the guarantee to the client?

What fees over and above the introducer commission is the company taking from the investment?

Ultimately, how can this investment work?

PS: there is one glaring omission from this ad. There is no mention that the company is authorised by the FSA. Is this a complete scam?