Financial advisers want more for their dealer group fees

financial advisers dealer group director

21 August 2012
| By Staff |
image
image
expand image

Smaller licensees may hold the solution for financial advisers seeking more value-for-money when it comes to dealer group fees, according to Pinnacle Practice director Anne Fuchs.

She said the majority of advisers who come to use Pinnacle's dealer group matchmaking service My Dealer Group are in their 30s and 40s and are currently running practices with one of the large licensees.

Many of these financial advisers are on older packages that provide open architecture in terms of Approved Product Lists (APLs) and are paying (in some cases) a premium of $15-$20,000.

Larger dealer groups often defend the cost of offering an open architecture, but Fuchs said it was "like paying for broadband services and getting dial-up".

She argued that there are a number of smaller licensees that have a strong corporate governance culture, a strict quota on the number of advisers they service and clear advice process requirements to manage their compliance risk.

"Importantly, this makes them affordable to younger advisers because they are only getting the absolute essentials," she said.

According to Fuchs, the criticism levelled at boutique groups is quite malicious.

"There are people in the industry tarring all small licensees with one brush; suggesting that because a licensee is small, inexpensive, doesn't have a cast of thousands and yet still offers an open APL, it can't have a good corporate governance and robust levels of compliance," she said.

Small or large, no licensee can ignore the demands being made by the growing segment of professional and highly educated advisers, she added.

"In fact, these are the advisers dealer groups should be recruiting, because they are very well educated, they don't have ingrained bad habits, they're growing revenue businesses and, generally speaking, they are working with other professionals in centres of influence to build their business," Fuchs said.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

This verdict highlights something deeply wrong and rotten at the heart of the FSCP. We are witnessing a heavy-handed, op...

4 days ago

Interesting. Would be good to know the details of the StrategyOne deal....

1 week 1 day ago

It’s astonishing to see the FAAA now pushing for more advisers by courting "career changers" and international recruits,...

3 weeks 6 days ago

Insignia Financial has made four appointments, including three who have joined from TAL, to lead strategy and innovation in its retirement solutions for the MLC brand....

3 weeks 1 day ago

A former Brisbane financial adviser has been charged with 26 counts of dishonest conduct regarding a failure to disclose he would receive substantial commission payments ...

1 week ago

Pinnacle Investment Management has announced it will acquire strategic interests in two international fund managers for $142 million....

6 days 8 hours ago