Letter: This is not how a network should work

Ian McIver

If you run a network properly, then the customer has the right to say that they no longer wish to be in the club. That could mean that they have outgrown the need for membership, which is positive and means the network helped them in their business plans, or, more importantly, if they leave for any other reason, then the network has failed. Put bluntly, I always used to say that no member was born with a tattoo on his or her behind saying that, when they graduate as an adviser, they have to join network X and indeed stay forever. The problem seems to be that network X invariably sees it that way.

The real issue is also that network members are getting a tad hacked off that they are always quoted as having the value in the food chain and indeed ownership of the clients, yet someone else picks up the cheque when the network is sold on. As a member of mine said to me not so long ago: “What is in it for me?”. Exactly – just when does he or she pick up a cheque for their share of the value chain?

The final fly in the ointment is professional indemnity insurance, or more precisely the need for PI run-off cover. We need an open debate on what this is all about. If a network asks for such cover, then what is the point of a network membership?

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RDR has changed the whole landscape for advisers. Networks that do things right are still all right, and if not, vote with your feet. One should be able to put those walking shoes on without fear of being unjustifiably penalised.

Ian McIver


IFA Compliance