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Regulatory costs force Norfolk advice firm to close

Regulatory costs have been blamed for the closure of a Norfolk IFA just days after advisers saw their FSCS levies almost double to £100m.

In a statement on its website, Norwich-based advice firm Taylor & Taylor says regulatory changes have made continuing as a business unviable.

It says: “We very much appreciate the support provided by our clients over the years and, while we will immediately cease providing financial advice services, our administration staff will be on hand until 29 May to help clients transition and help keep inconvenience caused by our decision to a minimum.

“We would like to take this opp­ortunity to thank you for your business. This has been a difficult decision for the directors and not one that has been taken lightly.”

The firm has been headed by Russell and Alan Taylor since its creation in 2003 and was approved by the FCA for pensions, mortgages and investments.

Taylor & Taylor’s client book has not been passed to another advisory business and instead product providers have been instructed to correspond directly with clients.

The firm has pledged that all client files will be scanned securely for any future regulatory purposes, with a professional firm brought in to subsequently shred files. It has not been put into default by the Financial Services Compensation Scheme.

Taylor & Taylor could not be reached for comment.

Kingsfleet Wealth managing direc­tor Colin Low says: “Increases to regulatory costs should be capped so that they can’t increase so rapidly.”

Basi and Basi Financial Planning managing director Michael Basi adds that regulatory costs can be most burdensome where firms focus on low-value work.

He says: “If you have a niche and you focus on it, the costs are entirely manageable. But practices dealing with a high number of transactions and low-wealth clients may become  unsustainable.”

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Comments

There are 5 comments at the moment, we would love to hear your opinion too.

  1. Julian Stevens 7th May 2015 at 9:24 am

    I imagine the latest round of additional FSCS levies, on top of all the others, not to mention endlessly escalating premiums for ever more restrictive PII cover will have been the final nail in the coffin. And, at the other end of the spectrum and for very similar reasons, HSBC is considering relocating its HO outside of the UK. Regulation and its costs are strangling the life out of the FS industry.

  2. This is a headline which will be used by those who have an agenda against the FCA regarding costs and fees. Yet again we do not know why this firm stopped advising and I would warrant that if you went through the accounts you would find that the fees and levies were not the reason for failure. They are used as an excuse for failure.
    If they said that the costs of giving advice in the current regulatory and litigious society, the costs of compliance, IT, employment, regulatory reporting then I would believe it. The rise in fees and levies is reprehensible, immoral and frankly bullying but not the prime reason why a business fails.

  3. The straw that broke the camels back !

  4. peter mulholland 9th May 2015 at 2:32 am

    Many business’ fail in all sectors for many reasons it’s capitalism and works the best

  5. Unlikely to be the full story…. there are usually other options such as mergers etc. This looks more like a tantrum than it does a sensible business decision…surely, if the client bank had any value they would have looked to realise the value in some way… and why abandon the clients like this? There must be more to this..

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