A spokesman for Legal & General is reported in last week’s Money Marketing to be “disappointed” that advisers were taking advantage of their product terms which allowed an investment to be enhanced in value by nearly 2 per cent after redemption charges literally overnight.
The spokesman goes on to condemn “unscrupulous IFAs, who are not acting in their customers’ interests”. Perhaps this spokesman does not understand his company’s terms but I do not see that showing such a return for a client is in any way not in their interests.
I can’t say that I had spotted this “opportunity” but perhaps I should have done.
Not in L&G’s interests for sure but that is not up to an IFA to consider. Did the product design team not take this into account? If not, they are in the wrong job. If the marketing and sales requirement prevails over the actuarial function, this sort of nonsense will continue to occur but to blame “unscrupulous” IFAs displays an astounding level of arrogance or stupidity or possibly both.
This is not new. For many years, Prudential allowed and encouraged this sort of activity but when senior management realised that they had allowed a loophole to go unchecked, it was IFAs who were blamed rather than stupid and greedy sales management, not to mention ineffectual actuarial and finance management.
Hall & Partners