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Ivan Massow: I’ll lose £200K from trail business closure

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Ivan Massow says he faces personal losses of £200,000 as a result of the closure of his commission return business.

Massow announced last week that the service would be closing due to escalating regulatory and professional indemnity costs. It launched in 2011, offering to return 80 per cent of a client’s trail, whilst keeping 20 per cent.

An email to clients last week stated the firm would retain all future trail income unless the clients moved to another firm. It said: “You could do nothing – but we will not be able to rebate any commissions we receive, and will keep them…. This may be useful for people who get little or nothing back and quite simply can’t be bothered to move their affairs.”

Massow, a former IFA, refused to supply a value of the trail payments the firm currently receives but says it is likely the firm will de-register at some point with remaining trail staying with the relevant insurers. 

Speaking to Money Marketing, Massow says: “We have had to make this horrible decision and it is all coming at a massive personal cost to me. Cleaning up the mess will probably cost around £200,000.

“We just do not have the resources to pay out the small amounts of trail. It takes a chartered accountant to work out who it all belongs to. I promise you we are not making a profit out of this.”

Barretts Financial Solutions senior partner Kim Barrett says: “This is an awful lot of money to lose for what should really be a low cost business.” 

Thomas and Thomas Financial Services managing director Darren Lloyd Thomas says: “I think the commission that is being retained here should be given to charity.”

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Comments

There are 21 comments at the moment, we would love to hear your opinion too.

  1. And he wants us to feel sorry for him ??

    Aghhhhhhhh bad luck there you go

    In the meantime my business value has plummeted due to the FCA wanting to Ban trail commission

  2. Aww what a shame. Screwing other people out of money (and potentially service) cost you money. Of course it could all be bunkum as no one will ever know if he made or lost money unless we look at the accounts.

  3. “You could do nothing – but we will not be able to rebate any commissions we receive, and will keep them…. This may be useful for people who get little or nothing back and quite simply can’t be bothered to move their affairs.” – disgraceful, cake, eat it and have someone else wipe away the crumbs springs to mind.. What comes around…….

  4. Whatever the reason for the failure of this business, it’s not likely to be increased regulatory costs.

    Unwelcome and excessive though they are, sound businesses are, and will continue, to survive and prosper.

    The issue here was a poor and badly researched business model, which attempted to exploit a market which wan’t there.

    ‘Too clever by half’, as many have suggested, and now, (although we’d all be happy to see the FCA accept responsibility for what it does get wrong) seeking a scapegoat, rather than admit to failure.

  5. I’d have replied sooner but I fell out my chair with a fit of the giggles….

    Seriously gents, na na na boo boo

  6. Sorry, I do not believe it. (Spoken in the style of Victor Meldrew)

  7. loss of reputation is greater than any financial misfortune

  8. Difficult to feel any sympathy for him, as his business strategy was cynical and exploitative.

  9. Loss of reputation? I suggest Massow has merely enhanced the reputation he already had.

    Like – is there ANYONE who’s surprised his latest project crumbled within 2 years?

  10. Cost of everything, value of nothing 28th August 2013 at 9:50 am

    “Prolonged laughter…..”

    deep breath…

    “coughing and spluttering from laughing so much”

  11. Dear Money Marketing

    Please stop writing about this clown. It isn’t newsworthy and is clogging up my inbox at the cost of some valuable content.

  12. There, there, come to mommy!

  13. Maslow schmassow 28th August 2013 at 11:05 am

    One failed business after another. Ivan you are not cut out to be an entrepreneur. Time to get a real job old chap…

  14. Following this latest failed business, maybe we should rename him, “Ivan the Terrible” (entrepreneur).

  15. “We just do not have the resources to pay out the small amounts of trail. It takes a chartered accountant to work out who it all belongs to.”
    So nothing to do with regulation and all to do with having no idea of how the business would actually function. Triumph of marketing over reality – for a while at least.

  16. Serves him b….. well right! 🙂

  17. Would those of you who had the character to put names to your comments like me to supply you with a fresh stock of stones? Why so vitriolic? I very much doubt that Ivan Massow ever elected to express his opinions anonymously. John O’Brien

  18. RegulatorSaurusRex 29th August 2013 at 5:27 pm

    Write it off against your tax bill Ivan, a “millionaire” has to be paying a hefty whack to HMRC.

  19. If Ivan is not going to provide any service or rebate for the trail why is he not just deauthorising now and allowing the insurers to either reduce charges took reflect the turned off trail (unlikely systems will allow this I know) or allowing the insaurer to treat the consumer as an orphan client and reallocate them to their internal sales force if they have kind or point the consumer at unbiased took find an adviser?

    Other fair alternative would be for someone to set up a firm as a charity to receive the trail and choose give thew clients a choice of transferring the agency and trail for no service to that firm instead. Keeps the accounting simple then.

    Keeping the trail and doing nothing is NOT TCF.

  20. this was a ‘get rich quick’ scheme playing on the back of a perception that some IFAs receive money for nothing.

    Ironic then that he wanted to do just that. I find it hard to believe that his latest ‘venture’ will actually cost him 200 grand, unless he employed a load of cronies on inflated salaries.

    We need to close a door on this character and others of his ilk as they have no part to play in professional planning at 2013

  21. “It takes a chartered accountant to work out who it all belongs to.”
    So why not just hire a chartered accountant?

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