RDR to do little for fees transparency
Almost two-thirds of advisers say the retail distribution review will not give enough transparency on management and transaction fees, a survey has found.
The survey of 100 IFAs by London-based investment management firm SCM Private, found that 64 per cent of IFAs thought the RDR would not improve transparency.
Some 78 per cent thought fund managers should be required to disclose the full breakdown of all fees incurred when investing a client’s money, and 60 per cent would be more inclined to invest if they could see fully where their money was invested.
Gina Miller, the co-founder of SCM Private, which is leading a campaign for the fund industry to disclose its charges clearly, said RDR was just a starting point.
Ms Miller said: “There is widespread support for transparency among IFAs but evidently there is concern RDR will not go far enough. It will give savers full detail on the amount they pay for advice but there is still a long way to go in terms of transparency regarding investment and pension fund costs, management charges and other fees.”
Colin Rothery, adviser for West Yorkshire-based Throgmorton Financial Services, said: “Anything that helps restore confidence to the market has to be applauded, but from my experience I’ve never had a client ask for more transparency from fund managers. I’m hoping that the RDR will greatly improve transparency, and I’d be interested to find out what fund managers think of this call. If you speak to them they would be clear there is certainly no smoke and mirrors in what they do.”