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Journey connections

The London Money Marketing RDR Invitational last week was a pleasant morning out of the office mixing with some of the brightest and successful IFAs in the land. All the IFAs were upbeat, keenly listening to the excellent speakers expounding what the RDR means for adviser businesses and which open architecture wrap platform would be the best to adopt following the FSA’s recent platform paper.

Incidentally, this paper does not make it clear how to move forward as the FSA has “mixed views” on whether an adviser can be independent using just one platform, the good money is on the regulator pushing for IFAs to adopt a multiple platform approach. I am convinced the regulator’s thinking is not clear on this issue as platforms are a bit of technology, which do not provide advice. If more one platform is used, efficiencies can be lost as clients’ data is held in different places and full aggregation is harder to achieve.

Against the conference’s upbeat setting, traditional product providers were handing out glossy literature containing phrases such as “succeeding in difficult times”, “how to keep clients happy” and “getting the most from your clients”. A few providers’ presentations were headed “what does the consumer want” and went on to persuade the IFAs that there is a place for simplified and restricted advice. I assure you that all the IFAs in the conference room could answer these questions as they see consumers every day – providers do not.

The issue that the product providers needed to talk about more is “how to make the transition to the RDR”. Informed Choice managing director Nick Bamford who started his IFA firm’s transition to a fee basis many years ago wished the audience well on their journey and pointed out it is not easy and mistakes will be made on the way. The audience were left wanting more information on how to make the transition. There are firms around that can help with preparing for the RDR but at a cost.

Tenet has just launched an “RDR-ready” adviser support campaign as distribution and development director Keith Richards says the company is concerned that as many as four out of five investment advisers do not hold the necessary qualifications to continue operating as an IFA after 2012.

The Money Marketing conf-erence concurred that if you merge together all the research about how the RDR will force advisers to leave the industry, between 10-15 per cent advisers may have left after 2012. It really depends where you look for these exiting numbers. IFA Promotion, which has more information on IFAs than most, says its latest figures show that, as at March 29, a total of 15,686 verified QCF level four (or above) qualifications were held by individual member IFAs recorded on its Find an IFA database. Individual member IFAs also record holding 11,443 verified QCF level three qualifications in addition to current bench-mark financial planning certificate 1/2/3. Both the increases on QCF three and four are slightly above what we have typically seen over the last year. A total of 4,063 IFA addresses hold QCF level three and 2,969 IFA addresses hold QCF level four (or above) qualifications.

As long as one registered individual at an IFA address has a QCF level four, then business can proceed as before, with the qualified registered individual taking responsibility for the advice. I am still to meet a South-east-based IFA saying they are leaving the industry before 2012 – they may change roles in the firm becoming, say, an introducer or a client relationship manager or may simply be retiring. Perhaps I need to get out more?

Kim North (kim@techandtech. is director of Technology & Technical


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