Reeve fears that if multi-ties are driven by commission rather than by service, this will affect their transparency and is calling on the industry to focus on offering a valid advisory proposition to consumers.
He reveals that Barclays’ multi-tie offering will link by product to key providers rather than tie to providers across the product spectrum as he does not believe that a provider can have a good service offering in all product areas. He says this is a more logical and customer-focused approach.
Reeve says: “There have been bold statements about driving up commission in multi-ties. As an industry, there is a danger that we will swing back to the attitude of the old world. These firms do not seem to have learned from the mistakes of the past. Focusing on commission gives a very narrow perspective. The whole point of depolarisation is to give the customer a better and more transparent proposition. I am not saying that advisers should not be remunerated but we have to make sure that advice is sold, not products.”
Thinc chief executive officer Simon Chamberlain says: “What nonsense. It is the big banks doing single ties that will drive up commission. There cannot be any commission bias at Thinc as whatever product the client chooses, the adviser gets the same commission.”
Millfield operations director Mike Duncan says: “Of course, there is commission but the drive behind multi-tie is that it brings a number of benefits, for example streamlining the business processes.”