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*cough* surely you must admit that the secret commissions paid to one famous fund platform does raise a conflict of interest?
What an IFA does and what a platform does are two different things.you have to ask if they were pushing funds because they were a good investment or because they paid the fund platform a juicy fee......
Their own comments in the media have suggested the very same thing. Many have also had their doubts. For example, brand new fund launches suddenly finding their way on there.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
:beer:What an IFA does and what a platform does are two different things.
Their own comments in the media have suggested the very same thing. Many have also had their doubts. For example, brand new fund launches suddenly finding their way on there.
Halleluiah, good to know that you realise that an IFA/ salesman will prefer to sell products that pay the most commission.
Well done :T
thumbs up to the Financial Services Authority as well for making IFAs disclose how much commission they were getting when they flog a customer a product :beer:
Lol, you never know, one day IFAs might get kicked out of their professional body for accepting secret commission ("bribes"). I would certainly get kicked out of my profession if I recommended a customer buy certain products and I was getting secret commission.0 -
Halleluiah, good to know that you realise that an IFA/ salesman will prefer to sell products that pay the most commission.
Nice to see you still making things up.thumbs up to the Financial Services Authority as well for making IFAs disclose how much commission they were getting when they flog a customer a product
The FSA did no such thing. It was the PIA that brought that requirement in back in 1994 I believe. So about 19 years ago. Well done on keeping up.Lol, you never know, one day IFAs might get kicked out of their professional body for accepting secret commission ("bribes"). I would certainly get kicked out of my profession if I recommended a customer buy certain products and I was getting secret commission.
If how you have misrepresented the the facts and comments on this thread (and others) is anything to go by how you act in your profession, then God help your clients.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
doughnutmachine wrote: »*cough* surely you must admit that the secret commissions paid to one famous fund platform does raise a conflict of interest?
you have to ask if they were pushing funds because they were a good investment or because they paid the fund platform a juicy fee......
If you are referring to HL then surely you must realise they are a DIY platform not an IFA?
Completely agree about the conflict of interest but that is nothing to do with IFAs. The reasons given for recommending certain funds by HL seem totally spurious with other funds not recommended despite better performance or similar criteria. One can only think that commission payments were the reason behind the odd choices.
IFAs are now paid directly by the client and don't receive commission payments from any investments recommended. In some ways good, others not so much so as shown by the difficulty getting advice by the OP.Remember the saying: if it looks too good to be true it almost certainly is.0 -
Completely agree about the conflict of interest but that is nothing to do with IFAs. The reasons given for recommending certain funds by HL seem totally spurious with other funds not recommended despite better performance or similar criteria. One can only think that commission payments were the reason behind the odd choices.
you made some good points, but I think historically IFAs have failed to recommend Investment Trusts because they never paid commission while Unit Trusts did.
If that's not showing a conflict of interest I don't know what is.
I just wish we could all acknowledge that salesmen will prefer to sell products that pay commission ahead of products that don't pay commission.0 -
Yes, the FSA said that commissions could lead to investment approaches that might well adversely affect client outcomes.
I guess a move to percentage fees are an improvement but I'm always happier with flat rates.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
gadgetmind wrote: »Yes, the FSA said that commissions could lead to investment approaches that might well adversely affect client outcomes.
I think common sense suggests that paying large amounts of commission to employees encourages bad behaviour.
The three professions that I can think of where employees get a large part of their income from commission are: estate agents, used car salesmen and IFAs.....
Estate agents and car salesmen are hardly famous for their straight dealing.0 -
Well, we aren't forced to use IFAs so why get so heated about it?
Estate agents OTOH are hard to avoid, which is worth kicking up a fuss about.
Car salesmen tend to have little real leverage as the world is full of used cars and you just walk if they won't play the game by your rules. They usually start to understand my methods when I plug a diagnostic lead into the car and connect it to my notebook computer.
I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
doughnutmachine wrote: »I just wish we could all acknowledge that salesmen will prefer to sell products that pay commission ahead of products that don't pay commission.
That is no different to a whole load of businesses. People are quite happy to pay way over the odds for bling because they are vain and that is all right.
The difference with financial products is you see the con for what it is hard cash. Not only that the con may not come to light until many years down the road when it is too late to do anything about it.
Bank FAs were a big problem. They tarnished views significantly. They handled a minority of business in most areas but had the most complaints. it is important to not mix up business models. A small local firm reliant on reputation and word of mouth which runs with no sales targets etc is a very different outfit to a bank which is tied to a small range of companies, the rep has sales targets and a sales manager threatening them with the sack if they dont sell more.
I agree that tied FAs were a big problem.
Whilst your small firm example may not have a muppet sales manager breathing down their neck there will probably be an extravagant expensive lifestyle to maintain in many cases. The same is true of estate agents in many cases."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
gadgetmind wrote: »Well, we aren't forced to use IFAs so why get so heated about it?
Estate agents OTOH are hard to avoid, which is worth kicking up a fuss about.
Car salesmen tend to have little real leverage as the world is full of used cars and you just walk if they won't play the game by your rules. They usually start to understand my methods when I plug a diagnostic lead into the car and connect it to my notebook computer.
Estate agents aren't needed either.
http://www.housesimple.co.uk/?gclid=CO2y_pfcm7sCFcUSwwodiXoAtg"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0
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