View more on these topics

Compliance tip of the week: Vulnerable clients a certainty

It is easy to dismiss the need to deal with vulnerable clients as at the fringes of advice, not something really applicable to you. But with one in five of us likely to develop dementia, and one in four of us suffering from some form of mental illness at any one time, it is inconceivable an adviser does not have several people who could be deemed vulnerable in some way at some point in time. Wealth, intelligence and success provide no immunity to mental health problems. Developing a policy is the minimum. Training staff to cope with these circumstances, which can be harrowing, is the right approach in my opinion.

There are obvious issues to consider around communication methods. Is a written letter appropriate on its own? Is the timing appropriate for a meeting? Who else should be involved?

In many cases there will be other people affected by the situation and it might be relevant to involve all parties. This could include legal advisers.

It will be vital for the adviser to set out the parameters of their relationship. I have encountered circumstances where unrealistic expectations have been set, with clients expecting their planner to control spending sprees, referee family disputes and micro manage personal finances. There are clear legal, financial and moral obligations which impact on the scope of an adviser’s role. Importantly, it should be very clear that regardless of the relationship of adviser and client, the adviser is not qualified to offer medical or psychological advice. Further thoughts on how this should be defined and explained to protect all concerned should be welcomed.

Phil Young is managing director of Threesixty  

Recommended

HSBC-Building-Reflection-700.png

HSBC paves the way to replace chairman

HSBC is reportedly seeking a new chairman to replace Douglas Flint. Sky News reports the bank has appointed headhunters MWM Consulting to specifically replace Flint. HSBC has a long-standing relationship with headhunters MWM Consulting to recruit for non-executive directors.  Flint has served on the bank’s board since 1995, and took on the chairman’s role in 2010. While […]

Verona-Smith-700x450.jpg

7IM offers direct platform for orphan clients

7IM has launched a direct platform for orphan clients who no longer have an adviser. The wealth manager says it was seeing demand from orphan clients and did not want to turn them away if they ceased to have a relationship with their adviser. The fee structure is the same as for its advised clients, […]

Burrows-Billy-2009-700x450.jpg
12

Drawdown customers risk losing out from ‘mortality drag’, report warns

Advisers must explain how ‘mortality drag’ means funds in drawdown must produce increasingly higher returns to match an annuity, a report claims. The paper, written by Retirement Intelligence director Billy Burrows for Partnership, warns that the “invisible force” of mortality drag means drawdown becomes less attractive relative to an annuity as a customer ages. Mortality […]

Chris-Hannant-Headshot-in-2013-700.jpg
11

Apfa accused of ‘giving up’ on fight for long-stop

Apfa has been accused of “giving up” on its campaign for a 15-year long-stop on complaints against financial advisers by considering alternative ways to stem liabilities.  The trade body is in ongoing discussions with the regulator after the FCA said in March 2014 it would consider the case for a 15-year long stop on complaints […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment