RDR rules prompt firms to hive off financial advice
An increasing number of accountancy firms are seeking to outsource their financial services, according to the chief executive of wealth management consultancy Capital Asset Management (CAM).
Since the introduction of Retail Distribution Review (RDR) on 1 January 2013, Alan Smith said his firm had seen a number of enquiries from small accountancy practices and that he predicts more will follow suit.
“The bigger firms will be okay, but I predict that for the smaller firms, the ones who do provide in-house financial advice will become increasingly rare,” Smith said.
“Without even trying, we've had three firms approach us to take on their financial services."
"On a rules level, it’s difficult for firms to meet the regulatory expectations and offsetting accounting fees is another issue. so they are asking what other options are out there.”
“The financial services area is very complex. So coming to an arrangement with a trusted ally is the best way forward. From a client perspective, it’s carefully handled, so their end result is a positive one.”
RDR, introduced by the FSA, outlawed the payment of commission to financial advisers on advice relating to investment pensions and annuities.”