The widely-held view that St James’s Place is one of the most expensive advice firms has been shot down by its former chief executive, David Bellamy.
The charging structure at SJP faced more scrutiny last year after an undercover investigation by Which? that found charge disclosure varied and restricted advice limitations were not properly explained to clients.
Speaking today at Money Marketing Interactive, Bellamy, who is now Weatherbys Bank chair, says there is rife misunderstanding over how SJP stacks up overall.
He says: “We as an industry talk about advice charges, investment charges, platform charges, performance charges and then other fees and costs. Seldom do we put all the charges we have together into one picture. As a vertically-integrated firm, we consider all charges together and we are not the most expensive in the market.”
He adds: “Our prices are constantly being compared to the rest of the market. We are lower than average but it’s very hard for us to get that message across.”
Bellamy explained the firm’s upfront six per cent fee, saying ongoing charges were limited to a 1.5 per cent annual management charge.
He did not provide details of how the charge is split between advice and product charge, confirming the structure still effectively locks clients in for six years.
He says: “It is an alternative way of funding rather than an excessive way. Clients pay the upfront charge, and then we wave one per cent of charges through the first six years, so that squares away the upfront charge.”
Bellamy also spoke against favouritism towards SJP due to its size and market position. While confirming the regulator ensures “fixed” firms have a dedicated team providing guidance on regulation, he says the FCA does not give preference to large networks.
He says: “I don’t think we are privileged in any way, shape or form. We get no special treatment from the regulator and it’s bizarre to think so. The preferential treatment is a fallacy that doesn’t exist.”
He adds: “The marketplace is huge and big enough for us all to find a place to add value into that market.”