FTIF: Towry Law received millions in trail commission

A debate on what does the retail distribution review means for intermediaries that took place at The Cumberland Hotel in London this morning started an argument between Mr Fisher and Alan Lakey, partner of Highclere Financial Services, about commission versus fees.

When challenged by Mr Lakey about whether Towry Law, which prides itself on charging fees, received commission, Mr Fisher said the business did receive trail commission but this was from legacy business that had been acquired.

Mr Fisher said: "It is business we have bought and I have been clear throughout that we want to move these people to a fee basis when we meet them. Quite often we cannot find these clients because of the way the industry works.

"If you are acting as the agent of the client then the client pays you. If you are acting as the agent of the provider then the provider pays you."

However Mr Lakey questioned Mr Fisher’s claims.

He said: "Trail commission can easily be turned off. I just call a company and tell them to stop paying me."

Also during the debate, Mr Lakey said the RDR was not fit for purpose.

Rebecca Thorpe, principal of Bovill, said while the RDR was laudable in its aims the cost of meeting its requirements would act as a barrier to entry to the industry for smaller firms in the future.

She said: "RDR proposals favour larger intermediaries and will make it more difficult for smaller start-up intermediaries entering the market."

The Financial Times Intermediary Forum is taking place at the Cumberland hotel in London today (10 November 2009).

This is the first event of its kind and experts and leading politicians have been gathered together to discuss how the credit crunch has affected the world of pensions.

To read what they have to say - as they say it - keep monitoring the FT Intermediary Forum website.

http://ftintermediaryforum09.ftadviser.com/live-text/