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Which? has always paid its way

In response to the letter by Michael Brayne of Brayne & Co in Money Marketing last week, Which? would like to put the record straight about how we conduct our research when mystery shopping financial advice.

The research is designed to test the quality of financial advice available across the market. Therefore, it is essential that we visit financial advisers that represent the market as it is presented to consumers.

In this research, we visited 28 tied advisers and 32 IFAs although three visits were voided. Many of the advisers were visited twice, some even three times.

By choosing this split of advisers, we do not need to make the distinction between commission-based and fee-based advisers as the market does this for us.

It was our understanding that all IFAs must now offer the option of paying by fees or commission. Therefore, as roughly half of the advisers were independent, half were at liberty to charge fees for their advice.

In our research budget, we have a contingency allowing for the fact that the IFAs might charge a fee. Several did and they were paid. We have always paid a fee if one is requested.

Our prime concern when carrying our research of this type is to recreate the experience of the average consumer fairly and without bias. The pity was that in this research, independent advisers fared little better than commission-based ones so perhaps the problem with poor-quality financial advice goes deeper than how advisers get paid. It certainly does for consumers.

Teresa Fritz

Principal Researcher Which? Money Research Group London, NW1


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