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Brodie wants networks to tailor menus for IFAs

Network IFAs should demand a bespoke payment menu if they want to make it clear that their firm is cheaper than their network’s average rates, says Master Adviser chief executive Doug Brodie.

Networks say they will offer tailored menus for firms req-uesting them but expect the majority of members to use templates. Networks’ templates will quote maximum commission averages which reveal what commission agreements networks have with product providers.

Sesame is offering its members two options – its menu template, which will show maximum commission on sample products likely to be sold by members, or a customised version which more accurately reflects the individual firm.

Aifa says that commission averages must be shown gross and nor reflect network fee deductions.

Brodie says Sesame has no direct interaction with his client relationships and is in no position to set his commission.

He says: “The menu system has been voluntary since January and will be compulsory within weeks. We have been working on our own independently. Sesame will give me a template containing the FSA’s market averages, with the option of fees v commission and I will fill in the blanks.”

Sesame head of compliance policy David Redgrave says: “We expect the vast majority of our members to run with the template. They then have the freedom to negotiate direct with their clients.

“This is a very difficult and complex issue that does not appear to have been thought through properly. I can imagine there are some smaller directly regulated firms that have been putting off dealing with this who might now find themselves unprepared.”

Aifa director of policy Fay Goddard says: “The menu must show the most that a firm intends to take in a particular product group and how it intends to take it. The maximum commission could differ gre- atly so the member might choose to set its own, more suitable for its particular business.”

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