Succession chief executive Simon Chamberlain has blasted “value destroying” networks and attacked the support service model.
Speaking at the IFP annual conference in Newport today, Chamberlain said network members would find it more difficult to sell their businesses and raised concerns about liability issues with big distributors.
He said: “The fact is Sesame, Openwork, Intrinsic, Positive Solutions, and Tenet own absolutely nothing. These are companies that destroy value. No company is going to buy a business that is networked on liability.
“You have got to be directly regulated if you want to successfully sell your business otherwise you cannot possibly negotiate when people try to buy it.”
Chamberlain then hit out at support service firms. He said: “Even worse are the non-regulated compliance firms like Threesixty. These are non-regulated firms going around telling everyone how to be regulated. It is an absolute joke.”
Speaking to Money Marketing after his session, Chamberlain said: “There is no inherent value in a network model unless you own it – there is no inherent value for network members.
“The proof of that is networks have been sold time and time again and I have never seen an advisory business pick up any money from it.
“When DBS turned into Sesame, the owners walked away with millions of pounds but member firms were treated like cattle. That has happened at Interalliance, Millfield, The Money Portal, and Honister. They just sell advisory firms like they are cattle and there is never a benefit for the people that created value.”
Threesixty services managing director Phil Young says: “There is neither any opportunity or requirement for Threesixty to be regulated by the FSA so I do not really see how this point is relevant in any way. If we were required to be regulated then we would be.”