Former Lifeboat director Brian George has teamed up with former Lifeboat compliance director Ron Skinner and former Lifeboat and Thinc Assured finance director Bill Wynn to create Network Direct, a national IFA for tied and independent advisers.
George says Network Direct’s proposition is different because it charges a flat fee based on the number of persons in the firm rather than a percentage of commission. He says this will help firms with fluctuating income to budget for fees. Fees will begin at £500 for a two-man firm.
He says: “A lot of ARs have found themselves in trouble because there is a hole in the network model – the harder the AR works, the more the network makes but the network doesn’t have to do any extra work.”
He says Network Direct will be unlike other networks as it will not be reliant on the turnover of its appointed rep firm. He says: “These networks have many processes sitting behind their firms they become totally reliant on those firms’ turnover. So a dip in turnover means a dip in income, but they still have to support their huge back office systems.”
George says the privately funded Network Direct will have a hands-off approach to its ARs – it will not have contractual ties to the firm and it says it will allow firms to follow their own business and marketing models, as long as they are compliant.
He says: “I want our AR members to have the best of both worlds, which will be the confidence of being in a network but also the ability to operate how they want to operate.”
Network Direct gained FSA permission last week and has already got two AR members. It says there are several more firms in the process of becoming members of the new network.