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Schroders, M&G and Artemis halt trail on reinvested income

by Rachael Revesz on Feb 22, 2013 at 11:04

Schroders, M&G and Artemis halt trail on reinvested income

Five major fund groups have confirmed they have turned off trail commission on reinvested income, even if advice to reinvest was given before the retail distribution review (RDR) deadline.

Schroders, M&G and Artemis said they have stopped the payments, joining Henderson and Jupiter, which said at the end of 2012 that commission on reinvested income would stop.

Under the RDR rules, commission is still allowed to be paid on reinvested income if the advice was given before 31 December 2012.

The five managers all employ fund administrator IFDS, and a source said implementing systems to cope with the commission payments would have cost £120,000.

Richard Clarke (pictured), co-director of Altrincham-based Chartwell Financial Services, said: ‘IFAs could lose anything up to 10% of their income and it could take them time to realise that.’

5 comments so far. Why not have your say?

Lone Gunman

Feb 22, 2013 at 12:00

Isn't IFDS the company which Skandia is in talks with around its wrap technology... I wonder if that has implications for existing SIS/Skandia holdings?

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KISS

Feb 22, 2013 at 12:16

Does this mean Jupiter (for example) charge 5% on the reinvested amount and keep the whole charge? That is initial commission, not trail. I am confused - can someone keep it simple for me.

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disenchanted IFA

Feb 22, 2013 at 15:25

So how are accumulation units in income funds affected?

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disenchanted IFA

Feb 22, 2013 at 15:27

So how are accumulation units in income funds affected?

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Lenny via mobile

Feb 22, 2013 at 23:52

No response from any of the fund managers, no surprise there.

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