St James’s Place is back in the headlines and not just the trade press for all the wrong reasons.
The headline in the Telegraph puts things rather succinctly with the following summation - St James's Place to pay overcharging victims up to £426m as shares collapse .
The news came with an apology to clients from the chief executive Mark Fitzpatrick amid a fall in the share price of £1bn amounting to about a third of its value. It prompted debates about who would pay the firm or ultimately its adviser partners.
The firm had seen a spike in complaints and upon investigation found that service standards had been lacking in many cases.
This is from the official statement.
“As we continue to focus on good outcomes for our clients, we’ve been strengthening our approach to evidencing ongoing servicing. A key element has been deploying technology to better track and record the service provided to clients.
“A recent assessment has highlighted possible gaps in the historic servicing some clients have received from their adviser. We will soon be taking a deeper look into this and have made a provision in our accounts to cover potential refunds.”
Among other things, the firm risks being booted out of the FTSE, as New Model Adviser pointedly puts it.
It has hired dozens of staff to handle complaints according to a no win no fee law firm spoken to by NMA.
An FT analysis suggests that SJP may not be the only wealth manager in trouble as Consumer Duty tests much of the sector, though in this instance SJP’s problems come from the previous regulatory framework of course.
In other news, Ben Hammond, director of consulting at The Lang Cat, has an interesting finding from its State of the IFA nation report. Writing in Money Marketing, he says: “When we asked whether AI was a consideration for firms, around one in three said they are currently using it or intend to do so within a year. And if we look a bit further out, say, up to five years, well over a half have plans to do so.”
The Government has supposedly scrapped the 99% mortgage scheme amid a barrage of criticism at least according to some government sources, as FTAdviser reports.
Finally a big regulation story. The FCA has suggested naming firms under investigation arguing it will be more transparent and will amplify the deterrent effect as Money Marketing reports. But what it doesn't seem to be asking is whether such a move is fair.
