I refer to the front-page article in last week’s Money Marketing headlined, Towry gets £6m a year trail cash for legacy business, in which you are quoted as saying: “It is not physically possible to trace back who these clients are and, in practial terms, it is not possible to turn the commission off.” I refute these statements as being totally incorrect.
On April 3, 2009, I wrote to Paul Byles of Towry Law, Bracknell regarding a client – Margaret Dexter of Harwell Village, near Didcot, Oxon, who had left Towry Law and moved to ourselves as her financial advisers. Mrs Dexter signed a letter authorising us to get future trail commission on her investments and policies and requested that Towry Law countersign a letter to her product providers authorising the switch of trail commission.
This was never counter-signed and Towry Law continue to get trail commission on products on which they no longer advise for Mrs Dexter. This is completely against the terms of the FSA’s treating customers fairly regime and Mrs Dexter expressly wished us to get this commission to offset any future fees due.
You have no place to hide with the statement of the physical impossibility of tracing this client as she has been presented to you with full details. I would appreciate your explanation of this anamoly in your stated position and the actuality of what is happ-ening in your offices.
I am sure that the FSA will be interested to read of your stance in continuing to get commission on this particular case, especially when you have been so vocal in your bad-mouthing of commission-based remuneration.
In this instance, you are not allowing Mrs Dexter to use this money to offset our fees.