Upheld: Other regulated complaint complaint against SUCCESSION WEALTH MANAGEMENT LIMITED

Decision detail

Summary

Mrs R complained that SWM unfairly charged her a monthly retainer fee in addition to an annual percentage ongoing advice charge. After SWM acquired her previous adviser Mr X's firms in 2017, Mrs R's standing order for the retainer was transferred to SWM, but no written explanation was provided of what the retainer covered. SWM argued the retainer was for unregulated services outside FOS jurisdiction, but the ombudsman found the complaint fell within scope as the retainer related to regulated advice and ancillary activities. The ombudsman concluded the retainer duplicated the OAC or was simply a fee to retain a particular adviser, neither of which justified charging both fees. The complaint was upheld and SWM was directed to refund all retainer payments not already paid, plus interest and £150 compensation.

The Ombudsman's reasoning

The ombudsman found the complaint fell within FOS jurisdiction because the retainer, although paid to SWM (a regulated firm), related to regulated financial advice and ancillary activities. The evidence showed the retainer was not for distinct unregulated services but rather duplicated the OAC or was simply a fee to retain a particular adviser. SWM failed to provide written explanation of what the retainer covered at the time of acquisition, and Mrs R received no additional services beyond those covered by the OAC. The ombudsman concluded it was not fair or reasonable for SWM to charge both an OAC and a retainer for essentially the same services, particularly as retaining a specific adviser involved no cost to SWM and was not mentioned in SWM's literature or fee schedule.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website