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Fisher: restricted Towry will give impartial advice
by Jun Merrett on Jan 22, 2013 at 10:20
The retail distribution review (RDR) may have forced Towry to sacrifice its independent status but this has done little to dampen chief executive Andrew Fisher’s enthusiasm for the reforms and his optimism for 2013.
Fisher said falling under the Financial Services Authority’s (FSA) definition of ‘restricted’ would not affect the advice Towry offered. Its advice would remain impartial, with its advisers being paid a salary rather than relying on product sales.
‘I am a strong advocate of impartial advice, which means the client pays for the advice themselves, and the person giving advice is salaried and acting in the interest of the client. That hasn’t changed, ’ he said.
Product sales dependence
Salaries are a topic close to Fisher’s heart and he had words of warning for advisers who depended on product sales for a pay cheque.
‘One area that is going to be really interesting this year is how much the adviser gets paid if the client doesn’t buy the product,’ he said. ‘If the answer is nothing at all, then I cannot see how the advice is impartial or suitable because by definition the person is just being sold a product.
‘This [model] is almost ubiquitous. I have looked at lots of firms that are becoming RDR-compliant and that piece of the jigsaw has escaped them. They have to adapt and change as it is not a sensible way to do business. If you can only get paid by selling something, then that is going back to the commission model but by another name,’ he said.
Refusing to recommend structured products
Fisher has been a long-term vocal supporter of the RDR and, while he is keen for advisers to push beyond it by becoming chartered or certified, he believes the new definition of independence will be difficult for firms to attain.
‘I think the independence hurdle is incredibly complex, quite high and difficult,’ he said.
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