A tied agent is not giving advice when he says to a client: “You have £50,000 to invest, so what you need to put it in is one of these.” He is selling.
By comparison, an IFA will (or at least should) say to the client: “Before we consider options for the £50,000 you have recently received, we should review everything you have already got.”
So, the potential client who has first seen an IFA and who, on visiting his local bank branch, is all but frogmarched into a meeting with one of the bank’s “advisers” (because the counter clerk has flagged up on screen his recently increased account balance) only has to say: “And what advice can you offer me on all my existing savings, investments and pension plans?” At that point, the bank “adviser” is forced to reveal his true colours as nothing more than an agent of (at best) just two or three providers and his only response can be: “Er…nothing.” Game over.
I have said it before and, for the benefit of Paul Evans, I will say it again. The difference between a tied agent and an IFA is that the latter is able to advise on all the products of all the companies that make up the marketplace, irrespective of whether or not he would recommend any particular company or any of its products to be a good place for the client to commit or maybe leave his money.
That, a tied or multi-tied agent can never do, so let us not pretend otherwise.