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PosSol loses 360 advisers and makes £1.6m loss

Positive Solutions saw 360 advisers leave last year whilst cutting its pre-tax losses to £1.6m.

The firm’s accounts for 2010 show an improvement on 2009 figures, when it made a loss of £6.9m, but adviser numbers fell 22 per cent, from 1614 to 1254. The firm saw a 2 per cent increase in turnover from £85m to £86.8m.

The results show pre-tax losses of £2.1m, although this includes provision for £508,000 not paid in share options because the firm failed to reach a valuation of £200m.

The results show the highest paid PosSol director received £501,000, compared to £351,000 the previous year.

PosSol chief executive Jim Reeve says the large drop in numbers is due to advisers choosing to become directly authorised.

Reeve says: “The further strengthening of our governance framework and changes brought about by the RDR resulted in some partners perceiving they should move to a directly authorised model in order to save costs and operate in a less challenging compliance environment. We strongly believe that both of these assumptions will prove to be flawed.”

PosSol attributed the reduction in losses to higher turnover generated by fewer advisers and the completion of a review in past business in 2009 with no further associated costs in 2010.

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Comments

There are 30 comments at the moment, we would love to hear your opinion too.

  1. While it is true that advisers have left to go directly authorised (many via True Potential) other advisers have left because of the network’s increase in charges.

  2. The figures for advisor numbers are wrong as I too will be leaving shortly! Not to go directly authorised but to another network who charge significantly less than PS!

  3. Charges have gone up, support has gone down and the network seems more interested in fleecing its own advisers than developing business.

  4. I got out years ago but not surprised, wonder who the over paid director was – let me think!!!!!!!!!!!!!!
    Been going downhill for years – there are much better cost effective options available – even without going direct. Model is to top heavy, thats the real problem, they used to work on a ratio of adviser v HO of about 30;1 – bet it not that now – and of course the top level are milking the business as most have done in previous lives.

  5. The only people in this industry who seem to be the winners are the employees of these networks. I ve seen them come and go and when they leave a golden parachute follows. Its the advisers who are working their butts of in order to fund these highly paid underperforming individuals ! This is why these networks make huge losses !

  6. I will also be leaving at the end of the year, fed up with being fleeced by a network with NO support

  7. Not sure why Jim thinks that those who have left have gone down the directly authorised route. The many advisers I know who have left – including myself – have moved onto other networks – where the retention rates are considerably lower and the the support and systems considerably higher.

  8. Iam leaving soon,The company has went down hill rapidly in the last 4/5 years

  9. I totally agree with the coments above Im also leaving due to the costs to stay with them, there are much better deals out there.

  10. Aegon must be crazy to sit back with £millions of losses every year. Now this year £1.5m loss and a director getting paid £500k this is absolute nonsense.

  11. I couldn’t be bothered to watch Titanic because I knew what happened at the end of the movie.

  12. I left (Resigned) 2 +Years ago thereafter, was fleeced, for a huge & speculative re-claim of fees & commissions, going back many years, all of which had been previously checked, verifed & approved by PS. & duly declared to the HMRC with IncomeTax due being paid, on all declared income, now largely unrecoverable !
    With many more former advisers also being hit for huge speculative claims.
    Nasty vindictive & malicious !
    I hope the regulator slaps a massive fine on Pos Sol for demonstrating serious regulatory failings SYSC: Failings in Systems controls & governance. Truly horrendous & shambolic !

  13. Highest paid director…? And what about the £2m paid from Aegon to Directors, does that not count?

    Can’t understand the logic of big business decisions, the company is losing good advisers and making losses, while increasing overheads at head office and paying bonuses to Diectors??? Sounds like a bank mentality to me….

    Maybe the people now involved only have their own personal interests at heart and will take what they can while they can…

    A once very good market leading and award winning company on a slippery slope it would seem…

  14. I left PS back in April and few other mates from PS have also left recently due to the increase in charges.
    I can confirm no exit interview took place, they have no clew what advisers have gone on to do ???

  15. I resigned over 2 years ago, soon after, PS made a huge speculative & malicious claim to re-claim fees & commissions paid over many years, all previously checked, verified & approved by PS. They also took the malicious step to stop me from trading. I was passed off as Fit & Proper for a decade, with no reported issues ever raised. All income declared to HMRC & now largley unrecoveralble. Business & Life in ruins Many former advisers have also been hit with speculative claims. It is no wonder advisers are leaving in droves ! I hope the regulator now hands down PS a massive fine for SYSC Failings in systems controls & governance, which would be fully deserved ….They are just a bunch of bandits who need shooting.

  16. This is why I firmly believe that the small IFA will ultimately be the true winner under RDR. The good guys are leaving PS because they know they can do better by themselves.

  17. I think many low producers can get a better deal elsewhere than PS offer – thus the reason that 22% of advisers left but turnover was actually up 2%.

    They are focusing on higher producers and number will fall below 1,000 , but this is a super tanker of a business that is and will take time to turn around – I’m afriad , despite that rose tinted specs (paid for by the Aegon deal) the old David Harrison PS model was not fit for purpose – why do you think he is now promoting a totally different approach with True Potential now ?

  18. It’s not too difficult for these firms to find out where their leavers go – they just check the fsa register.

  19. Ancient Wisdom is....a mortgage broker in N3 5th October 2011 at 8:00 am

    £500k pay for director? – he will be out of a job when RDR kicks in and turnover drops like a lead ballooon.

    Enjoy it while it lasts.

  20. I am just about to come to the end of my 3 months notice period. I can assure Jim that I am not going directly authorised. There are many better propositions out there. PS were fleecing me for 35% retention I now have a similar proposition that I pay only 20% for. Its a no brainer.
    PS have priced themselve out of the market by the greed of the directors, nothing else. It will not surprise me if they fold before the end of the year!

  21. If PS advisers are leaving to join True Potential, it will be akin to jumping out of the frying pan and into the fire.

  22. I left just over a year ago. Jim Reeves has lost the plot when he treats the advisers like empolyees. Directors such as Keith Gillmoore and others join for a fat pay package then leave when the going gets tough. The have to decide if they are a support network or a charity.

  23. I am just about to give my notice also. We get no support, head office staff through the roof, useless directors and recruiters talk nonsence. I had a friend who was approached by a recruiter and he brought along his recruitment director who my friend said told nothing but porkies. I advise do not join this firm no matter what has been promised and do not fall into charms of recruiters. Also the charges are a joke.

  24. No wonder this company do not progress, I worked for them and you can only communicate by E-Mail, it is like being involved with big brother.

    Ran by idiots, who have no idea how to treat people.

    I am at a network who cost far less, and teat people like adults.

    This lot will eventually fold.

  25. As in the gold rush, those selling the shovels are the ones that actually make the profits. The safety of a network is very questionable. Direct authorisation is a few more forms, lower costs, a bespoke business model and true independence. I would think ideal for post RDR world.

  26. Sadly all comments are true and I cannot believe that for the third year running a company makes a loss with the directors having an increase in remuneration.

    PS was always a good company to work with and the National IFA model worked well, however we have in the last 4 years adopted a bancassurer mentality and culture where advisers are not valued (no one bothers to contact leaving advisers) and are now having to resort to a Network Model to survive but which will fail.

    I am leaving soon and joining a small company who are directly authorised and who are looking for advisers who are keen to have an input into the company culture and direction, who will charge a discounted renewal/trail fee and a defined exit strategy that will work. If anyone wants to join me I am sure the company will be happy to speak with you, just call 0844 4142744 and mention this thread.

  27. Jim stated at the annual conference this year that he was confident that PS would not make a loss this year and so where does that put him? Surely he knew then whether or not the company had made a loss and if not why not?

    A year of disappointment for all. How about doing the honourable thing.

  28. I really dont think Positive Solutions is going to survive post 2012. I have never seen a company rewarding their directors constantly for bad decisions. In the last Year and a half I have seen nothing but disapointments. Well done directors please increase retention rates next year so you can be paid more for your fantastic decisions

  29. Advisers have nothing to fear from direct authorisation. Anyone in a network would have been brain washed to think that way.

    I left a network over 6 years ago and will never regret that.

    Talk to a service provider like Simply Biz (other service providers are available), their model office and thinking is years ahead of RDR even.

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