Ifa using true potential for admin

johnnyren

 my ifa recently told me he was going to use true potential to service my funds ,   all they would be using was there back office systems and admin support ,        he claims this will save money and it's just outsourcing ,   my pension will stay with standard life and we will not be using any of true potentials investment portfolios .
Does all that seem reasonable ,   I'm just about to sign a transfer of servicing request from true potential to standard life to take on future servicing and future /outstanding renewal fees .    Does it seem above board of should I be concerned ,   I have his assurance in the form of a email that it's strictly admin support   but I can't help being nervous ,   it's just my nature      thanks 

cfw1994

I’d guess you are right to be concerned.

Is your IFA close to retiring?

https://forums.moneysavingexpert.com/discussion/comment/77892742#Comment_77892742 

johnnyren

cfw1994 said:

I’d guess you are right to be concerned.

Is your IFA close to retiring?

https://forums.moneysavingexpert.com/discussion/comment/77892742#Comment_77892742 

No he has no intention to retire ,   I raised this with him and he assured me they were only being used for admin purposes ,  to save money on costs ,   and that my pension would still be with standard life with nothing changing 

IvanOpinion

The 'save costs' is probably your IFAs costs and will save you nothing.  TP have been known to offer incentives to IFAs who move their portfolios to them.
Read the documentation carefully and ensure that there is no transfer fee, no exit fee, no change in the management or platform charges.  Maybe take this as an opportunity to go DIY.

dunstonh

Does all that seem reasonable

If he isn't using their investment portfolios and just their software then it is not a concern.   

He is becoming an appointed representative of True Potential.  An appointed rep can remain an IFA on regulatory permissions (i.e. whole of market) but the Network takes on responsibility.   The adviser has to follow network rules.   He effectively ceases to be your adviser at a firm level. True Potential become your adviser firm.  

 I'm just about to sign a transfer of servicing request from true potential to standard life to take on future servicing and future /outstanding renewal fees .  

This is because he is moving his clients from the current firm to True Potential.

 Does it seem above board of should I be concerned ,

It is certainly above board. Networks have existed for very many decades.  Although they are different today to how they used to be.

The main concerns are whether he is retaining IFA status and can place NEW business over the whole of the marketplace.  Often with these agreements, they drop to FA status but can continue to top up existing products but any new business goes to the tied provider. So, in your case, you may still be able to have your Std Life plan topped up but what if Std Life go off the boil and need moving?  Would his only option be TP or is he still independent?    You will be required to sign a new terms of contract/adviser agreement as the old one will no longer be valid (as True Potential will be the adviser firm going forward).  These should state the adviser status in respect of being independent or not.   An adviser is either IFA or FA.  There are no other classifications.  Get him to confirm his status.

I have more concern for the adviser if he is a directly authorised IFA and not already a network IFA.    If he is directly authorised and going to TP then he is giving up a lot of decision making and passing it to TP.  He may not be prepared for the amount of freedom and choice he is going to lose.   If he is already a network member then he is used to that.    

If you look at other networks, then there is also the concern of mission creep. Initially, it starts off as standardising internal software, then more systems and controls, then they end up on the most restricted offering.   The more an adviser restricts, the cheaper it is for them and also often the bigger the earnings can be as tied offerings tend to be more expensive to the consumer.

Angiepup

Oh this is exactly what's happening to me ! Are True Potential on a huge acquisition drive right now?