PimfaOct 24 2022

Pimfa suspends adviser over CII sanctions

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Pimfa suspends adviser over CII sanctions
West Riding Personal Financial Solutions managing director Neil Liversidge

Adviser trade body Pimfa has suspended a member due to sanctions that were imposed against him by the Chartered Insurance Institute.

According to Pimfa, the suspension in September came after the adviser trade body had reviewed an investigation against West Riding Personal Financial Solutions managing director Neil Liversidge.

That investigation had been carried out by the Chartered Insurance Institute after a complaint was made relating to one of the adviser's tweets.

There are those in Pimfa’s hierarchy who want rid of me.Neil Liversidge

Earlier this year, this had resulted in Liversidge being asked to do an online ethics course with the CII.

This has now been completed, a fact that Pimfa said it has factored into a review of Liversidge's membership, which could be reinstated in November at the board meeting.

The original complaint

Liversidge was first notified by the CII about the anonymous complaint on November 8, 2021.

The tweet, which prompted the complaint, published on November 5, 2021, concerned Lord Patel's appointment as chairperson of Yorkshire County Cricket Club.

Following the CII’s letter to Liversidge, a disciplinary investigation ensued. 

Eight months later and following an investigation, the chartered body found the adviser had breached the CII’s Code of Ethics by making inappropriate comments on his social media account.

It said: "The respondent breached the CII Code of Ethics by making inappropriate comments on his social media account."

Following this, Liversidge completed the course and compiled with the sanctions imposed.

FTAdviser understands that Liversidge had sanctions imposed but was not subject to suspension and therefore remains a member.

However, in September, Pimfa suspended Liversidge on the basis of the CII sanctions, stating he was in breach of membership rules.  

Our public membership rules clearly state that any member deemed to have brought themselves, Pimfa, or the industry into disrepute can face action, which includes having their membership suspended. Pimfa

It told Liversidge the matter was considered “on a no names basis” and that item 14 of the Pimfa rules updated in April 2017 stated that, where a member is guilty of conduct of bringing the association or member into disrepute, the directors may, if they think fit, suspend or terminate the membership of the member in question.

At the time, Liversidge was told that the board determined that the best place for representation is with the professional institute and they “reserve their right to not provide you with an opportunity to make representation to the Pimfa board on this matter”.

This decision meant that access to information on the website, membership of committees, voting rights, or any other member benefit, was suspended immediately.  

A spokesperson for the adviser trade body told FTAdviser that its policy is to support professional bodies such as the CII in raising standards and if any of its members is suspended or sanctioned by one of those professional bodies, the Pimfa board will give due consideration as to whether it is obliged to act as well. 

“Our public membership rules clearly state that any member deemed to have brought themselves, Pimfa, or the industry into disrepute can face action, which includes having their membership suspended,” it said.

Pimfa said as a prominent member of its Strategic Advisory Group, Liversidge’s sanction by the CII, required the board to consider his position as a member of Pimfa. 

“This has no bearing on his membership of the SAG, which is a separate issue,” the spokesperson added.

“Pimfa only became aware of Liversidge’s suspension from the CII in July and the next meeting of the Pimfa board was not until September.

"Therefore, any decision as to whether any action on the part of Pimfa was necessary, could not be taken by the board until that meeting in September.”

At the board meeting in September, Pimfa said it was determined that Liversidge “had brought himself into disrepute by his actions” and should have his membership suspended in line with the suspension imposed upon him by the CII. 

“Part of the sanctions from CII is that he must complete an online ethics course within three months of the date of his sanction by them on June 20, 2022,” a spokesperson added.

“We are aware that Mr Liversidge states that he has now completed this online ethics course and we have ratified this with the CII.

"A decision as to whether Mr Liversidge will be reinstated as a member of Pimfa may be taken at the November board meeting.”

The SAG committee

Separately,  Liversidge said he was informed in May 2022 that his two-year term on the SAG was coming to an end and that his attendance at SAG meetings would end after the June meeting.

Speaking to FTAdviser, Liversidge said Pimfa chief executive officer Liz Field informed him that its board would select replacements for the SAG. 

“That meant, of course, that those representing the largest wealth managers, national firms, and networks, would decide who would represent small adviser firms,” he said. 

“That [is] disgraceful - and probably illegal - attempted power-grab was completely contrary to the promises made when we agreed to APFA’s merger with the WMA, that small firm members would continue electing their own representatives.

 Ultimately, should existing members of the SAG secure enough votes from financial adviser members they will be reappointed to the SAG. Pimfa

“I do understand there are those in Pimfa’s hierarchy, who want rid of me.”

However, Pimfa explained that the terms of reference for membership of the SAG state that four IFA members of the SAG may sit for a term lasting two years. 

“Mr Liversidge has sat on the SAG and its predecessor committees since the Wealth Management Association and the Association of Professional Financial Advisers merged in 2017 to form Pimfa,” it said.

Following this notification to Liversidge, he made a number of recommendations regarding SAG membership, many of which were accepted by the board at its June 2022 meeting, according to Pimfa.

Pimfa said: “Liversidge made further recommendations, which were considered at the September board meeting, and again many of those recommendations were accepted by the board.

“Among the recommendations made by Mr Liversidge, and accepted by the board, was that existing members should be allowed to stand again after they have completed their initial two-year term should they wish, in perpetuity, subject to the voting of the IFA members.  

Those representing the largest wealth managers, national firms, and networks, would decide who would represent small adviser firms.Liversidge

“Ultimately, should existing members of the SAG secure enough votes from financial adviser members they will be reappointed to the SAG.”

The member voting process began in September and under these new revisions, Liversidge is now a candidate for re-election to the SAG.  

Pimfa emphasised that a variety of its smaller member firms are “well represented on the SAG” and there is a greater turnover of larger firms. 

“All financial adviser firms - large or small - are also welcome to sit on any of Pimfa’s committees and working groups we run and there is a large number that do,” it said.

sonia.rach@ft.com

Update

The suspension was subsequently revoked. 

Liversidge continues to serve on the PIMFA Strategic Advisory Group, having been re-elected by the members of the small firms’ constituency by an overwhelming majority.