IFA: Referrals on the rise due to RDR adviser attrition

Wiltshire-based Lexington Wealth Management has seen an increase in professional referrals and has been approached by multiple accountancy firms in particular that are looking to partner with advisory businesses after losing their existing advisers to the Retail Distribution Review.

In an interview with FTAdviser to be published later today, Lexington chartered financial planner Warren Shute says he was surprised to receive enquiries from accountancy firms hoping to form business partnerships.

He said many accountants and the like had lost their in-house advisers, who retired ahead of the RDR coming into force, and were therefore seeking business partnerships with external independent advisers.

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Mr Shute said: “We have become a lot more busy with new enquiries. Accountants actually approaching us saying ‘our adviser left would you be interested in working with us?’.

“So many advisers retired come January a lot of these firms don’t have advisers to refer to. It’s unique for us to receive a call from accountants saying we would like to work with you.”

Lexington Wealth Management also has a partner accounting firm called Dennis and Turnbull Financial Planning.

Although some advisers have retired since the RDR came into effect, recently-published data from the Financial Conduct Authority suggest total adviser numbers in fact grew by 6 per cent between January and July this year.

This did, however, follow on from a steep decline in the lead up to the RDR. Adviser numbers fell by 20 per cent in the year to December 2012, with a 13 per cent fall being recorded in the final six months alone.

In April of this year, FTAdviser sister publication Financial Adviser reported the expected “mass exodus” of retiring IFAs had not yet taken place.

The full interview will be published later today.