Mr Javid was not the only person shaking up his allegiances this week, however, as changes to Sanlam's fee model led a number of advice firms to quit the network. It's time for the week in news.
1 Javid out, Sunak in
Sajid Javid caused a shock this week when he refused to fire his team of advisers and therefore declined to stay on as chancellor of the exchequer in a tumultuous government reshuffle.
MP for Richmond in Yorkshire, Rishi Sunak, was swiftly given the keys to number 11 Downing Street — with just 18 working days to prepare for the Budget next month.
In the wake of the announcement, the industry urged Mr Sunak to tackle the tapered annual allowance, deal with the lifetime limit for pension contributions and put a halt on the controversial changes to the IR35 rules set to come into force in April.
2 Sanlam suffers
FTAdviser revealed this week that firms were leaving the advice network Sanlam after it changed its fee model to charge a minimum of £20,000 regardless of turnover.
Some eight firms have left the network as a result, while at least 22 are looking at ways to reduce their fees to minimise the impact of the charge set to come into force in two months’ time.
Although the move is expected to negatively affect 30 out of 100 appointed representatives, Sanlam’s chief executive John White said it was a case of the firm becoming “more aligned” with the processes of the main Sanlam Wealth business.
3 A problem of perks
National independent advice firm Chase de Vere came under fire this week when it was called out for rewarding its top-selling advisers with luxury holidays.
It emerged the firm had named its best 10 earners at a lavish conference where those who made the top spots were sent on a luxury three-day trip while a whistleblower claimed the whole event had centred around money.
Chase de Vere said the firm, along with its culture and operations, had been misrepresented, stressing the advice company operated in an entirely transparent, client-focused and accountable manner.
4 Not my problem
Issues surrounding the FSCS levy continued to make headlines this week when the Treasury refused to accept responsibility for the scheme’s structure.
Several advisers have written to their MPs since the levy was hiked once again last month, but the industry’s hot potato was passed back to the FCA when John Glen MP, economic secretary to the Treasury, said the lifeboat scheme was independent from the government.
As the controversy around the levy lingers on, the Personal Finance Society and the Impartial Financial Advisers Association have produced templates for advisers to lobby those in power.
The FSCS's chairman Marshall Bailey has told FTAdviser he would be open to a review of the scheme's structure.
5 City-watchdog complaints
A 50 per cent rise in the number of complaints against the FCA was primarily down to concerns over the regulator’s supervision of the industry, data revealed this week.
An FOI response showed the regulator had received 1,532 complaints throughout 2019 — 52 per cent more than the 1,007 received in 2018.
Complaints under the category ‘failing to act on information’ jumped six times year-on-year to 425, while ‘failing to spot a problem’ complaints rose from 11 to 274.
imogen.tew@ft.com
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