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LIA says advisers would do better under DPS

IFAs would do better under the FSA&#39s defined-payment system than under Ron Sandler&#39s proposals for the remuneration of advisers, claims the LIA.

Under Sandler&#39s plans, advisers would negotiate payment with clients, a process the LIA does not believe IFAs are prepared for.

Director of public affairs John Ellis says that under the DP system, IFAs can still operate on a commission basis, even if the amount of payment is determined by providers, a concept that Sandler opposes.

Ellis plans to take his message to the FSA and the Government and to conduct a survey of LIA members to see if his fears are confirmed.

Sandler says a form of commission could still exist as the fee could be paid over time as a percentage of the initial payment or of the funds under management, much as commission operates today.

Ellis says: “The reason why this system is worse than the DP system is because you have taken commission away.

“It will be up to the IFA to negotiate a fee and advisers are not prepared for these changes.”

Baronworth Investment Services director Colin Jack-son says: “This is not quite right. Most independent advi-sers are well able to negotiate most things because that is their business. It is whether the clients will be willing to pay for advice.”


Berkeley Morgan buys up Summit

Berkeley Morgan is buying rival IFA Summit Financial Holdings in a deal worth about £533,000, which will increase its RIs to 340 from 290, including mortgage advisers.The two companies have worked closely together since October 2001 when Berkeley made an initial investment of £439,500 in Summit. The latest deal means Berkeley buys a further 74 […]

NU makes emergency cuts

Norwich Union is devaluing all with-profits policies by 5 per cent and slashing bonuses in an emergency measure blamed on falling stockmarkets.The changes, which take effect from August 1, mean terminal bonuses will be cut by whatever amount necessary to meet the 5 per cent overall cut. Some terminal bonuses will be wiped out altogether. […]

Analysts&#39 fears over Abbey as chief exec Harley leaves

Analysts are warning that the Abbey National group faces uncertainty until a new chief executive is found following the departure of Ian Harley last week.Harley quit the troubled group, which includes Scottish Mutual and Scottish Provident, following a profit warning and loss of its AA rating in June.Although the problems are mainly within Abbey&#39s wholesale […]

Taking issue with role of the CA

CA director Sheila McKechnie demonstrates the seamless transfer of consumerists from single-issue research into single-issue six figure income news management in the FT with the headline, If this industry can rip off consumers, it will.From being an unbiased observer, she joins those of the Daily Mail ilk, that is, if it is not news, it […]

Rise of the machines

Head of Sustainable Investing at Royal London Asset Management, Mike Fox, looks at the case for including artificial intelligence within a sustainable investment strategy. Read the article in full here The value of investments and the income from them is not guaranteed and may go down as well as up and investors may not get […]


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