Solicitors prefer to work with independent advisers rather than restricted advisers, adviser and solicitor business development firm Sifa said, despite the Solicitors’ Regulation Authority allowing referrals to restricted advisers,
Speaking at a Prudential-sponsored adviser seminar yesterday (14 October), the firm’s development director Dave Seagar, said Sifa has found it’s members prefer IFAs to restricted advisers.
He said: “In old terminology, restricted whole of market is fine, but multi-tie is not,” he stated, adding that solicitors still definitely had a bias towards independent advisers.
Mr Seagar previously told FTAdviser that “we would accept restricted advisers as members, but all our 170 members are independent”.
In November 2012, the SRA recommended to its board that solicitors should be allowed to refer clients to any financial adviser, be they independent or restricted, following the implementation of the Retail Distribution Review.
A number of major nationals and networks, including notably Sesame at the turn of the year, have moved restricted since January last year, though the trend has not yet translated to smaller firms.
However, the Institute for Chartered Accountants in England and Wales said the slow and steady adviser movement away from independent advice towards restricted has been branded as a potential “cause for concern” for referring professionals in other sectors.
John Gaskell, manager of financial planning within the financial services faculty, previously said this stemmed from the fact that under the new rules there are “many more shades of grey under one label, restricted”.
In addition, Mr Seagar also said at the event that advisers should use their experience to help become trusted partners and drive client referrals.
He said that the biggest opportunity for advisers was around making life easier for solicitor’s compliance officers for legal practice who, under new rules, are responsible for outcomes-focused regulation, much like those the Financial Conduct Authority enforced following implementation of the RDR.
Speaking to an audience of advisers, he urged: “You’re way ahead of them on this, so as someone who has been through this kind of thing, use your experience to be a business partner and trusted consultant.
“When trying to set up client referrals and reciprocal business with solicitors, help them with their compliance by demonstrating why you tick the boxes, show your qualifications so that they can explain to clients why you are suitable to give investment advice.”
Colin Thomas, business consultancy manager at Prudential, agreed that “there has never been a better time for advisers to work with solicitors”.
He added that advisers should treat them like potential clients by explaining expertise, particularly in matching any specialisations that may match with those of partners at the solicitor firm.
These could be things like qualifications or accreditations from the Society of Later Life Advisers, the Society of Trust and Estate Practitioners, or endorsement from the Law Society.
Mr Seagar said: “There has been a pincer movement of the RDR and Legal Services Act bringing the two professions together and blurring the lines between them.”
peter.walker@ft.com
Additional reporting by Donia O’Loughlin
