Fidelity FundsNetwork and Cofunds have joined Skandia in confirming they will continue to pay trail commission business on past business until the FCA’s ban on legacy payments between fund managers and platforms comes into effect in April 2016.
Skandia announced this week it will gradually transition its legacy book of Isa and Collective Investment Account business to an unbundled model over the next two years, as and when an event triggers trail to be switched off, such as advice that leads to change in the product and top-ups where no commission is allowed on the new investment.
Skandia platform marketing manager Michael Barrett says: “The adviser gave us the business so it is up to them to turn off trail in the future. It is not up to the provider to make the decision.”
A spokeswoman for FundsNetwork says: “We have no plans to switch off trail commission. However, we have seen a significant number of advisers move to fees already and we expect the majority of assets to have been converted by this date.”
A Cofunds spokesman says: ”It remains our intention there will be no automatic transfer from bundled pricing to clean shares. Platforms should work with advisers to migrate their client books over to clean share classes and therefore platform pricing at a time that works for them, but obviously in line with the FCA’s time frames. This means the adviser is in control, not the platform.”
Axa Elevate managing director David Thompson says it did consider automatically switch assets to clean share classes, but this changed in the wake of the FCA’s confirmation earlier this month that legacy cash rebates can continue.
Standard Life announced in August it would bulk switch all investments into clean share classes in November, a move which will end trail associated with the assets.
Pilot Financial Planning director Ian Thomas says: “The fact different treatments are allowed just highlights the inconsistency of the regulator.”