In February 2024, the Financial Conduct Authority (FCA) requested data from the 20 biggest advice firms in the UK relating to their ongoing services after major firms came under scrutiny for charging fees for advice that was not delivered.
The Financial Conduct Authority (FCA), the regulator for financial firms and markets in the UK, is awaiting the results of an information request it put to the 20 biggest advice firms, and the resulting impact could be huge for the industry, according to experts.
The request relates to the ‘ongoing advice fees’ saga in which it has been found that financial advisers have been charging clients fees for annual reviews and ongoing advice that they have not received.
The Financial Ombudsman Service (FOS), which is responsible for investigating and resolving disputes between individuals and financial services companies, has published a number of decisions in which firms have been instructed to reimburse clients for unfulfilled fees.
Advice market review
+ −As part of the FCA’s Consumer Duty work, in which the association is looking to crack down on regulated firms providing unsuitable advice or charging obscure fees, it requested data from the 20 biggest advice firms in the UK relating to their ongoing services and whether they had made any changes since Consumer Duty was introduced.
It also requested that each firm provide data on:
- How many clients are currently awaiting a review of the ongoing suitability of the advice received as part of the service
- How many clients have received that review
- How many clients paid for ongoing advice but received a fee refund as the review did not happen
In February 2024, wealth management firm St James’s Place (SJP) was served with a section 166 notice by the FCA – a section 166 notice, or ‘skilled person review’, requires regulated firms to appoint (or have the FCA appoint) a skilled person to review their activities. According to CityWire, the skilled person was appointed to:
“review a large sample of the firm’s ongoing advice back-book, and the business will go back from 2018 to 2023 and look at whether there is evidence clients received an annual service”.
Around the same time, SJP announced that it was ringfencing almost £430 million to cover the cost of complaints expected as a result of ongoing advice fees and obscure charges.
In April 2024, after discussions with the FCA, Quilter Financial Services Ltd (Quilter) was also served a section 166 notice regarding its ongoing advice service.
Have you been paying for ongoing financial advice that you have not received?
+ −If you have engaged with a financial adviser, financial planner or wealth management firm and think you may have been paying fees for ongoing advice or annual reviews that you have not received, speak to TLW Solicitors.
Working on a ‘no win – no fee’ basis, TLW’s experienced ongoing service fees team can help you through the compensation process, whether this is settled in the early stages directly with your financial adviser or through the Financial Ombudsman Service (FOS).
TLW Solicitors’ team has extensive experience successfully taking cases to FOS and securing client compensation, even if they have been knocked back previously.
TLW Solicitors’ view
+ −Sarah Spruce, Legal Director and Head of the Professional Negligence department at TLW Solicitors, commented:
“The potential scale of the ongoing advice fee saga is huge and there are so many individuals who could be affected. In some cases, the fee structures are so obscure that clients are completely unaware they are paying for advice and annual reviews they are not receiving, which could mean that they are stuck with underperforming, unsuitable, or unnecessarily risky investments that could cost them even more in the long run.
My team can review your case and let you know if you could be owed compensation from your financial adviser, financial planner or wealth manager. Get in touch for a no-obligation consultation to explore your options and see if you may be eligible to make a no-win, no-fee refund claim.”
TLW Solicitors can help
+ −If you or a loved one believes that you have been paying fees for ongoing financial advice and reviews that you never received, you may be entitled to compensation.
Get in touch with the professional negligence team at TLW Solicitors for a no-obligation conversation about your claim.
You can call us on 0800 169 5925, email info@tlwsolicitors.co.uk or complete one of the forms below.
Time limits can apply, and so anyone wishing to bring a claim should do so without delay.
Minimum claim values apply.
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Meet Sarah, who heads up our experienced Pension and Investment Claims team.
Sarah and her colleagues are on hand to help with your claim.