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Henderson delays £4m trail to advisers over RDR audit

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Henderson says the trail will be paid in July

Henderson Global Investors is delaying payment of around £4m of trail commission to 7,300 advisers due to an “RDR audit”.

The trail, which was due in mid-June, relates to the period between November and April and has been held back to ensure all payments are RDR-compliant.

Henderson says it cannot cut off a portion of commission to make the checks so all payments have been delayed.

The investment house says the delay is a one-off exercise as it is the first set of commission payments it has processed since RDR implementation.

Henderson commercial director Stewart Cazier says: “There are certain types of new business where it is still permissible to receive commission such as execution-only or offshore business and in those cases where there is, for example, an adviser claiming a commission payment, we look for a declaration that this is non-advised and execution-only.”

“The reason we have had problems is that this is the first time we have done all of these checks.”

Cazier adds he expects the payments to be started again within the next couple of weeks.

Barretts Financial Solutions senior partner Kim Barrett says: “The lack of communication from Henderson on this problem is arrogant in the extreme.”

In March, Money Marketing revealed Ignis Asset Management, Jupiter Asset Management, Artemis Investment Management, Henderson Global Investors and M&G Investments were all cutting off trail payments on reinvested income even if it related to advice given before the RDR deadline.

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Comments

There are 6 comments at the moment, we would love to hear your opinion too.

  1. No problem there are plenty of other fund managers out there who don’t play games and pay up on time. Lesson learned.

  2. Pleased to hear a company of this size is taking their RDR responsibilities and regulatory checks seriously.

  3. Becoming a headcase IFA 26th June 2013 at 10:09 am

    “Ignis Asset Management, Jupiter Asset Management, Artemis Investment Management, Henderson Global Investors and M&G Investments were all cutting off trail payments on reinvested income even if it related to advice given before the RDR deadline.”
    Yes, all companies that are on our list of not doing business with and switching out of, as soon as an ethical opportunity arises.

  4. Unfortunately some fund managers are using RDR as an excuse to fill their boots.

    As has been publicised here some of them have switched off commission but continue to have pre commission annual management charges.

    I hope that the FCA is keeping a close eye on this.

  5. Compliance person 28th June 2013 at 9:08 am

    I may be wrong but I believe the link between all of these firms is that they all outsource to IFDS.

    Any regulator reading these pages will see some of the comments as confirmation they have done the right thing in bringing about RDR – not exactly helping your cause by saying you’ll be transferring business away from these companies as they aren’t paying commission!

  6. While Compliance person is right the RDR does mean that you need / have opportunity to review these funds that have pre-commission AMCs and I suspect in many cases business will / should get transferred away!

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