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Can I refer clients to a restricted financial adviser?
Category: Compliance
Yes, there is no rule preventing your firm from referring clients to a restricted financial adviser. However, you have a responsibility to make sure your client understands the distinction. A restricted financial adviser can only recommend products from a limited range of providers or product types. An independent financial adviser, by contrast, can recommend from the whole market. This matters because your client may assume that any adviser you refer them to will provide whole-of-market advice. If the adviser is restricted, your client could end up with a product that is not the best available option for their needs. Under the ICAEW Code of Ethics, you should act in your client's best interest. This means disclosing the adviser's regulatory status (which you can verify on the FCA Financial Services Register at register.fca.org.uk), explaining what 'restricted' means in practical terms, and letting the client make an informed decision. Many firms choose to include only independent financial advisers on their referral panels to avoid this complexity. Others include restricted advisers but ensure the distinction is clearly communicated. Either approach can work, provided the client is properly informed. If your firm does refer to restricted advisers, document the disclosure alongside your standard referral consent records. This protects both your firm and your client.