They have now scored a victory in the form of clarification from the Solicitors Regulation Authority, which said that solicitors may only refer clients to independent financial advisers for investment advice.
On the back of this clarification, St James’s Place issued new guidance to its partner firms conceding that they cannot provide investment advice to clients referred to them by solicitors.
The guidance acknowledges that the SRA views an independent adviser as one who can “advise on products from across the whole of the market and offers the client the option of paying fees”.
But it also stresses that solicitors can continue to refer clients to SJP partners for a “wide range of advice” including advice on inheritance tax planning, trusts, business succession planning, long term care, protection, general insurance and mortgages.
Sifa managing director Ian Muirhead says: “This is a major step forward but clearly the war is not yet over because SJP are still encouraging their salespeople to provide advice to solicitors on matters such IHT planning and trusts. It seems extremely unlikely that the salespeople for a company where 90 per cent of its income comes from the sale of its own investment products will be able to provide advice without also making a sale.
“So solicitors are likely to continue to be confused and IFAs need to keep up the pressure on SJP by reporting breaches to Sifa and emphasising the benefits of their own independence.”
Do you think it is plausible that a product driven multi-tied salesforce is the appropriate place to refer specialist advice on inheritance tax and long-term care?
How do you think firms such as St James’s Place will position themselves post-RDR?
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