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Selectapension advisers asked to change licence after T&Cs tightened

USB-Wires-Computer-Technology-700.jpgSelectapension has asked a number of advisers to move onto different licences after an audit showed they were accepting a high number of referrals from other advisers.

Selectapension recently contacted advisers that use its service to alert them of a change to its terms and conditions, which took effect from 28 July.

The updated terms and conditions state that the service can only be used by a “named user” and cannot be used in conjunction with any third party advisers without prior and express consent by Selectapension. The terms and conditions say shared use of a licence is prohibited.

The previous terms and conditions, which were in place from 31 July 2015, also said the user licence could only be used by the named user and that shared use of the licence was prohibited, but did not mention third party advisers explicitly.

Selectapension national accounts director Peter Bradshaw says: “We wrote out to everybody to say we have amended our terms and conditions to clarify that point about usage.”

“It was already in there that it was for named users only but we wanted to say that we were not looking for them to use the system in conjunction with third party advisers without our consent, in which case we would charge a fee accordingly. The more cases that are run, the more support required and hence the price.”

Selectapension would not be drawn when asked for the number of reports an adviser would be writing before they would be asked to move to a different licence.

Bradshaw says: “They would have to tell us typically how many cases they would be likely to write. Back in the day when some of these were set up it was just writing defined benefit business as it came up within their existing client bank, which is a totally different prospect to setting themselves out to get referrals from other advice firms.”

He adds: “There isn’t a firm number. We did an audit to see the usage of the system and how many cases were being run and it was obvious in two or three cases that some were using it massively.”

Money Marketing understands that some advisers could pay at least five times as much under the new terms.

Bradshaw says there are a range of prices that depend on usage of the service.

He says: “It is not a fixed price. We have a price-list for our standard licence but if you are having a different business model, where you are using paraplanners or a centralised unit for checking work or you are doing a bureau-style arrangement by getting referrals from other advisers then there would be bespoke pricing according to your business model.”

Advisers signed up to Selectapension’s transfer value analysis service were asked to accept the terms and conditions before accessing the site, which led to concern from at least one adviser that they would be locked out of the system if they did not accept them.

Bradshaw says: “We wrote out and asked advisers to accept online and most of them have to the best of my knowledge.”

In July Selectapension suspended its defined benefit pension transfer business after an FCA audit of its outsourced advice firm.

The Selectapension Bureau Service handles report writing and transfer value services for pension transfer analysis, but uses IFA firm CFPML to execute advice.

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  1. If an adviser firm has the correct number of licences for its individual advisers and decides to take referrals from numerous other advisers that is of no concern of Selectapension.

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