Payments from platform providers to advisers need to be monitored more closely and disclosed more readily, according to OneVue CEO Connie McKeage.
McKeage says that while the payments might be fine, the non-disclosure of them is not in the best interest of clients and goes against competition.
“It’s actually a serious problem for independents within the industry because it’s really quite anti-competitive, specifically for those that have taken the view that everything does need to be disclosed,” says McKeage. “And I don’t think it’s really the intention or what the Government had in mind, when they were saying that people should act in the best interest of the client.”
McKeage has talked to other businesses in the industry that say they are in the same boat as her – advisers that have lost adviser groups to people making these payments. “We’re decided to start standing up for competition basically, and for genuinely acting in the best interests of the client.”
The payments could be one of two; a payment to keep the money where it is, or a payment to move the money onto a platform. When that fee or product is more expensive or does not have the same or equal features to something else in the market, then McKeage says the client needs to know.
“If they can genuinely stand up and say this is in the client’s best interest, then you would’ve thought there should be absolutely no hesitation in letting the customer know that they’ve received a payment for staying in that fund. And if they’re not willing to stand up and tell their customer, you’ve got to ask yourself why.
“It’s very hard, if you’re an advisory group and you’re struggling and somebody opens up their cheque book and gives you money. Are we saying that’s wrong? No. we’re not saying that’s wrong, as long as the customer knows what’s transpired.”
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