Raising awareness: Fund managers fees

trazer985

Hi,

I was looking for a place to raise this anonymously but there isn't so I'll see how this pans out here.

I have worked at 2 huge financial services firms that provide outside advice and regulatory work to investment managers/fund administrators, and have had exposure to pension funds (non-state) and trust funds set up/wills converted to funds. They are not for the rich and famous, a large number of these were set up by parents wanting to ensure their house and worldly possessions went the right way for their family. They arent megamillions, and often have just a few tens of thousands in (not that much when you consider its a will, not a savings account).

However, most disturbingly are the fees being taken off these accounts. I need to note that nothing illegal (however I don't know the law well enough) is happening here, it's just people are probably unaware about what happens to their money.

I've seen several times, IM's taking fees for accounts they no longer administrate (i've seen the letters from the trustees stating they no longer act for them), and only on rare occasions letters challenging this by the beneficiaries/trustees. They take about £1000/year per service (legal and fund managing) for providing literally no service at all (most of the times they arent even named).

It's not been uncommon to see funds being milked systematically for nearly a decade. I can't raise anything internally, since it's not in my remit, and I can't provide the documentation as evidence (it's client account information after all), however I can try and raise awareness of it.

I can verify to a member of the MSE team that I do work at a company well positioned to know (by sending an email from my work address), but won't divulge that to the public google indexed forums here, since it's wrong to associate the company with this as they havent done anything wrong and their hands are tied by regulation and brand, plus looking out for my own skin.

I'm not interested in naming and shaming IM companies either, I only care about getting the right result for people. It would certainly help quite a few people.

I didn't submit this to the news@ address because I'm not in a position to be able to take a daytime phone call in the near future.

thanks and have a great bank holiday weekend all

T

jamesd

There's a problem with your post: it contains nothing on which any individual can usefully act. You're alleging that trustees are neglecting their duties to supervise those they appoint but with no information about who those neglectful trustees are. You're alleging fraud by investment management companies but with no information on which are committing the alleged crime.

You should perhaps check into your legal obligations under money laundering regulations. You appear to be in possession of information about actions that you are legally required to report to the appropriate internal reporting team. "Not in your remit" is extremely unlikely to apply, since it's a legal obligation of all employees. You probably have a confidential ethics helpline that you can use to seek guidance on how you are supposed to act in these situations.

Good luck with resolving your ethical conflicts!

trazer985

Submitted to my firm's AML team as per above advice. It's anonymous but I'm on a team of 1 on this. Probably won't be too hard to figure it out.

jamesd

Good luck with it. Such a pain to have to deal with things like this.