IFAs may stop doing pension transfers altogether if they are forced to pay for independent transfer value analysis, warns a leading technology provider.
Chambers Townsend Con-sultancy managing director Nigel Thomas says Sesame's decision to force members to pay for reports from independent TVAS provider O&M Systems – reported in Money Marketing last week – could see other networks adopt the same policy. CTC is the technology provider for Alexander Forbes IFA.
Thomas says the extra costs for individual firms could see some advisers stop doing pension transfers altogether.
He says in a market that should be gearing itself up for pension simplification, it is crucial that advisers continue to use all resources available to them to carry on doing transfers.
TVAS provider FPS Mark Lloyd director Karen Littlejohn disagrees, describing Sesame's move as a “wake up call” for advisers. She urges advisers to limit compliance risk by making sure they are using the most accurate information for clients.
Thomas says: “IFAs will now have to pay for TVAS up front this means a load of advisers will simply stop doing transfers. This is a world where to give advice is more risky than not.”