It won’t come as a great surprise to readers of this blog that I think most investors are basically fairly sensible people. I’ve never subscribed to the narrow view that all investors are perfectly rational but equally I think that most private investors can be trusted to make the right decision about their finances. I’m in favour of nudges towards virtuous behaviour and I’m also a big fan of regulators putting a stop to the bad practice, especially in the more adventurous sectors of investment and finance. But as a general rule, I think the basic principle of good regulation should be that investors can be trusted to do the right thing – and be left alone to make their own decisions, no matter how daft they may be. The nanny state has its uses but not when it comes to consenting adults and their long-term finances.

So it’s against this backdrop that I find the recently suggested changes in alternative finance contained within an FCA consultation worrying. I’ve already written about these proposals at length in this blog, on AltFi and in the FT. My AltFi article, which contains a fairly good summary of the argument is HERE.

My basic principle is that investors should be left alone to decide how much they want to invest in alternative stuff such as peer to peer lending – and even crowdfunding. The FCA proposals I think set a worrying precedent which is what I call ‘ channelling’ – forcing retail investors into simple, supposedly easy to understand investment products and structures. Anything that deviates from this prescribed set of ‘safe’ options become subject to increasingly complex rules around knowledge tests and portfolio allocations. Not only do I think these are impractical – they can be gamed – but I also think they strike at a very important principle. Trusting the investor to make the right decision.

If like me, you find the proposed changes worrying – the thin edge of the wedge with increasingly draconian channelling the next steps – please join with me in signing a petition recently launched by 

The petition is live with the government now and can be found HERE – the web address is

Please do sign the petition and forward to anyone you think shares my concerns. it’s not too late to effect a change in the ideas discussed – it is only a consultation. But we do need other retail investors to agree with our position.