View more on these topics

Disclose white-labelling costs, advisers warned

Threesixty has warned that failing to disclose the cost of white-labelling a platform could put advisers in breach of treating customers fairly.

Threesixty partner Phil Young has warned that advisers need to be alert to the potential treating customers fairly conflicts if advisers do not disclose to the client the fact some white-labelled platforms could be accessed more cheaply if they were not branded in the IFA firm’s name.

“White-labelled wrap platforms are now available which differ from the original only in that they add an extra 15 basis points to the cost, which the consumer pays for, and the distributors and its advisers carve up between themselves.

“While the benefits of the additional basis points are enjoyed by the distributor, and payments are disclosed in key features literature, there is no formal obligation to disclose to the client the fact that the same platform can be accessed at a much cheaper price.

Young adds: “There are some serious ramifications for everyone as it clearly contravenes TCF principles. This is perfect national press material which could bring consumer confidence in advice down at a time when the vast majority of advisers are doing an awful lot to improve it.

“A minority of advisers using wraps for the wrong reason may cause problems for everyone.”

Ascentric managing director Hugo Thorman says: “Where a platform provider shares the margin with the adviser, it is important that the adviser discloses that fact. Of course, if the adviser offers a platform at a higher price than the client could get elsewhere, that implies a higher level of disclosure from both a TCF and conflict of interest viewpoint and that fact should be disclosed as part of adviser charging.”



News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm