I refer to the letter from Julian Stevens (July 26) regarding the activities of mystery shoppers and ask why practitioners are getting so agitated about it.
My understanding is that an authorised individual cannot provide financial advice without knowing the client’s circumstances. If my understanding is wrong, I await to be corrected so I cannot understand why advice is being given without either having met the client or receiving a letter of engagement.
More important, would a chartered professional, such as an accountant, surveyor or solicitor, act in such a manner? I do not think so. Usually a price is quoted and/or a meeting is arranged. May I suggest the following procedure, which would in essence make the mystery shopper redundant and could be incorporated into a practice’s TCF:1: Phone rings and is answered. The enquirer usually identifies the purpose of the call.2: If the caller is not known to you, politely ask whether they are known to the practice.3: If not, ask from where they obtained the practice’s personal details, that is, recommendation, IFAP, Yellow Pages. Here, one is trying to vet a potential client. Hopefully, it is a recommendation from an existing client or a fellow chartered professional. If it is via Yellow Pages or IFAP, politely ask why they chose you among the multitude of other advisers quoted. Again, one is trying to weed out the timewaster or the free advice merchant/ mystery shopper. A reply from a potential client that they had rung a number of advisers and you happened to answer the phone over the weekend is not the sort of client that any adviser should want.4: Assuming that the client is one you want, explain that it is illegal to provide advice without knowing the client’s circumstances. Suggest that a confidential financial review together with disclosure information and terms of business are sent in the post to be completed and returned to you. Alternatively, invite the client to a personal interview at your office, without obligation and without charge for up to 30 minutes.
I have used this method for more than a decade and it works. Many sales-oriented advisers are so eager to transact new business that they forget a new client may ideally provide a long-term business relationship or, if properly vetted, a potential source of litigation.
New Barnet, Hertfordshire