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Fund groups fight Cofunds on axed fees

Cofunds is under pressure to review its decision to stop paying fees to fund managers re-registering Isa and Pep funds on the platform.

M&G is understood to be one of a number of fund managers which have sent a letter to Cofunds questioning the decision although the firm declined to comment.

Cofunds will halve the £25 fee in February before stopping it from October 2009.

The decision has been received particularly badly by a number of fund firms which were sent a letter informing them of the decision rather than being consulted on it.

Schroders managing director of UK retail Robin Stoakley says: “The news was not the happiest piece of information that has come across my desk as this lowers our margins. However, we have decided on this occasion to accept the decision.”

Cofunds marketing and propositions director Alastair Conway says: “We needed to offer a rule for all on this particular issue and could not bend it for those who do more business in this area.

“The reaction has been balanced in response to the decision and those firms that have sought further consultation have found us happy to do so.”

Chelsea Financial Services managing director Darius McDermott says: “It was always going to cause some unhappiness. I was told they had spoken to a number of providers although clearly not all of them about the decision to stop subsidising these re-reg transfers. The issue is between the providers and Cofunds but if it were to be passed on to my clients, then it would be a worry.”

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