Trevor Newham, co-founder and previously commercial director of IFA Network, said the new network-type resource would be called Freedom Partnership and allow the client-adviser relationship to continue despite the retail distribution review strictures.
Mr Newham said: “We believe the word ‘freedom’ is very relevant. At the moment people are constrained by the RDR and cost of compliance. Freedom Partnership will give them the opportunity to continue dealing with their clients without those burdens.
“It isn’t about cheating the system. What I’m doing is pulling together a core of services to which these individuals can refer clients and get paid for, but without being regulated.”
Freedom Partnership will give ex-advisers access to online resources to which they can refer clients. These resources will provide information about available products without giving a recommendation – if a client wishes to proceed, their enquiry will be taken up by a third, regulated party.
Certain cross-selling agreements will prevent the regulated firm from poaching these clients.
How the ex-advisers will be paid and the nature of Freedom’s income streams are yet to be finalised.
Mr Newham added: “These people are going to lose their regulated status. They will have a client base of some description. In the majority of cases they still have a need to earn an income. We put those three things together and give them a way to earn an income from those clients.”
He said Freedom Partnership aims to sign up at least 50 ex-advisers by launch, but he predicts there is a potential market of “thousands” more as advisers feel the full effects of the RDR on their businesses.
Chris Hulme, director of Manchester-based Clayton Hulme Partnership, said: “This is a fantastic way for those advisers who have great client relationships to still ‘service’ their clients and look after them, while maintaining some level of income.
“The downside I suspect will be for those advisers who receive the ‘leads’ and the issue about the source of ‘introduced business’ opeing up.
“Could the scoundrels and fraudsters exploit what is otherwise an excellent support in the market? I hope not.”