IFA network Berkeley Wodehouse Associates is being accused of rendering its members' firms worthless by including clauses in their contracts giving the network ownership of renewal commission.
ProAct legal partner Gareth Fatchett is writing to all 200 Berkeley Wodehouse network members, alerting them to clauses in their contracts which he argues ringfences commission to the network if a member decides to leave, close their business, retire or has their contract terminated.
Fatchett is awaiting a response from BWA director Valerie Gaze following his request for clarification of what the network's policy is on exit strategies for members.
Fatchett is arguing that the IFA does not own the renewal commission, leaving them little to sell on.
He is calling on network members to seek a variation to the controversial clauses of the contract or defect to an alternative network.
ProAct is distributing a guide to contracts to all network members to help them analyse its arrangement against other networks.
“Members are not told by the network they will take the renewal commission but this is stated in the standard contract,” says Fatchett.
Berkeley Wodehouse Associates was not available for comment.