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Wealth check

We are currently seeing active transfers of both people and businesses. In the beautiful game, we have Ronaldo indicating that he may be off to climates more glamourous than Manchester and the gossip pages saying that Roman Abramovich will have sold Chelsea by next season. All this football hearsay falls away compared with the financial services gossip.

In my current role of head of compliance for, members have seen senior personnel choose to move to more attractive climates. For example, Paul Haddock from the Stock Exchange to Ofex, with the Times covering this move as “poached Haddock”.

John Tiner of the FSA is leaving to secure a position in the private sector, just as the Mighty Mifid begins to take a hold and while we wait for the depolarisation review findings.

In the investment area, Catherine Garrett-Cox moves from Morley to Dundee-based Alliance Trust and Bill Mott goes to PSigma. But does this movement of fund managers really matter to the investment houses? Yes is the answer.

The Credit Suisse income fund has lost nearly 450m since Bill Mott relinquished the reins in 2003.

On the provider pitch, Axa UK is repositioning following the takeover of Winterthur Life, with senior management being appointed to reap the rewards of the increasing wealth of the populous. As we help make the rich richer, we must not ignore the Unicef findings that in the two decades up to 1997, the number of UK children living in poverty almost trebled, workless households increased and public services, vital for children’s well-being, were starved of investment.

We must do all we can to make financial services advice and quality products and services available to everyone – not just the rich.

At the core of any wealth management proposition must be an open architecture/wrap platform with in the past 12 months alone, the amount of assets under management held via web platforms in the UK growing from 25bn to 40bn, according to Defaqto.

Any wealth management offer needs to provide solutions for all individuals. If not personally tailored to the needs and wants of individuals, the generation of wealth, admittedly along-side celebrity status, can for some result in a death sentence, as seen by the loss of Anna Nicole Smith.

I believe that wealth management advice should include guidance on the amount to be spent on a regular basis of the accrued wealth in the correct and tax-efficient way. How many portfolio modelling tools automatically include the recommended level of cashing-in of holdings on a regular basis?

It is not just the M&A activity that heralds a different future for the providers, it is the type of products and services that are available.

Clerical Medical announced (not for the first time) that from April, it will not write any new group pension schemes as the costs of chasing and administrating new schemes has become too high and because too many schemes are being switched from provider to provider, resulting in a downward pressure on margins.

If Clerical cannot cut it in the group pension space with the financial backing of HBOS, who can? It is a shame that Clerical’s benefactor was not in the group pension space for the long haul but what obligations do providers have to provide products?

Yes, we have too many providers and too many products – over 30,000 available to IFAs. If footballers decided that they did not want to commit to tackles because it may hurt, what sort of game would we see?

Is this a fair analogy in financial services – we will write individual personal pensions but not group personal pensions because even though we can, we do not want to. Financial services people must lay their products and services on the table, make them clear, fair and accessible to all, then commit to providing them for the long haul.

Kim North (kim@techand is director


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