Ruddlerless Cofunds' strategy hit by rebate ban

The uncertainty surrounding the leadership of Cofunds following the shock departure of chief executive Brett Williams is mirrored by lack of clarity over how the platform should develop to meet retail distribution review (RDR) requirements.

Cofunds instigated talks which led to Williams’ departure after a clash over its strategy, New Model Adviser revealed last week.

The platform is committed to moving to an unbundled pricing model and will spend tens of millions of pounds making the transition, but marketing director Alistair Conway (pictured) said uncertainty over the future of fund manager rebates was holding back its development.

The Financial Services Authority (FSA) said it planned to ban fund manager rebates in its platform discussion paper in March.

The three bundled adviser platforms, Cofunds, Skandia and Fidelity FundsNetwork – which with Hargreaves Lansdown and Standard Life make up the UK Platform Group – have protested against the ban.

Conway (pictured) said that until the FSA confirms the ban it  would not be clear how Cofunds should develop the platform.

‘Our issue has been the running order and we have paused for breath in the last few months as we now might not be able to have rebates at all, and that has added a new dynamic,’ he said.

‘We need clarity from the regulator on this. It’s not about not being able to deliver – it’s about delivering the right thing.

‘Brett was only too aware, as shareholders are, that we are on track to meet our targets for the unbundled solution, but it would be madness to build the complete solution without knowing what the final rules are.’

Investing in the upgrade