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Cofunds hands advisers Q3 2015 sunset clause comms deadline

Cofunds will give advisers until Q3 2015 to move their clients to clean share classes before it takes over communicating the impact of the sunset clause.

The platform says advisers will be given bulk segmentation and conversion tools in early 2015 to help them move large back books of clients to share classes that do not charge trail commission.

But it says if clients have not been converted by Q3 2015 it will “take the communications lead” to ensure it complies with regulations by February 2016.

If investors are still unresponsive by then, the platform will automatically move them into compliant funds.

Cofunds head of marketing Stephen Wynne-Jones says: “At that point we are going to effect a conversion to the new world. We believe clean share classes are the most effective way of achieving the FCA’s ambition. They’ve largely said the same – we don’t believe a bundled model with rebates is a good outcome for end investors.”

Cofunds chief executive officer David Hobbs says: “We’re offering advisers extensive support, including a range of helpful materials and tools on our website. We’ll add enhanced MI capability and an intuitive online cost-comparison tool later in December.”

He adds: “Throughout next year we’ll continue to work closely with advisers to identify where they’ve not been able to contact clients and, where appropriate, we’ll contact them directly. These investors will remain the clients of their advisers, and we’ll ensure the advisers are kept informed throughout the process.”

The platform has previously warned that clients who do not respond to requests to move their assets could see them liquidated, which could have a negative tax consequence.

In 2013 Standard Life bulk converted its entire book of clients, but Cofunds distribution director Andy Coleman said moving 600,000 clients at once would be “unpalatable”.


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