Networking / Not working
If nationals had an uphill struggle, networks faced Everest. Their commission-based stack’em high model was always under threat from the RDR, but increased professional indemnity (PI) insurance costs and a Narnia-like closet containing an army of skeletons proved their ultimate undoing.
The biggest casualty of the year was Honister which entered administration in June due to hiked PI costs to cover legacy issues, including 88 claims worth over a combined £10 million against a single Burns Anderson adviser who allegedly mis-sold unregulated property investments through a Sipp.
Other networks which had a year to forget included Pi Financial which was fined £58,300 by the FSA over the sale of - yes you’ve guessed it- Ucis, and structured products.
Lighthouse also endured a torrid year with its failed attempt to delist from the AIM market leaving its board red-faced and then executive chairman David Hickey heading for the exit.