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VirtualNet waives 20k fee after row

VirtualNet has been locked in a bitter dispute with a former member who is accusing the network of applying unfair charges to lock members in.

MacArthur Denton Asset Managers threatened to take legal action against the online network when it was hit with a charge of just under 20,000 on resigning its membership.

VirtualNet insists that the charge, which represents the firm’s monthly membership fees from the date of its resignation to its anniversary of joining the network, is written into its terms and conditions.

The network waived the fee after being threatened with legal action. VirtualNet spokes-man Andrew Bedford says the waiver was an exercise of discretion by the network because the firm had resigned only two weeks into its new contract.

The IFA’s managing director Ray Galt says his firm was plagued by problems which prompted it to leave the network, including the failure of VirtualNet to induct and auth-orise new members of staff. Galt says he had to pay the sal-aries of two RIs unable to transact any business for six months.

Bedford says: “Our RI application and authorisation pro-cess has never failed. We are thorough in our vetting and will only take on appropriate people. To say we are applying hidden charges to lock people in is fundamentally wrong.”

Galt says: “No company would write off 20,000 that they were contractually ent- itled to.”

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