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The “Fee for No Service” Quagmire: A Ticking Time Bomb for Advisers and Clients Alike


In 2020, I highlighted a critical issue plaguing the financial advice industry: the "Fee for No Service" problem. This issue is not confined to St. James's Place (SJP); it extends to other firms like Quilter, Brewin Dolphin, Rathbones, Hargreaves Lansdown, and typical Independent Financial Advisers (IFAs). The problem has far-reaching consequences for both clients and advisers.

The issue has raised its head again. See today's article in the Telegraph, The Trouble with St James's Place

The Client's Dilemma

Clients are often charged exorbitant fees for services they never receive. This practice is not only unethical but also illegal. The Financial Conduct Authority (FCA) has been aware of this issue for years but has done little to address it. Clients are left in a financial quagmire, paying for services they don't receive, which can have a significant negative impact on their financial well-being.

The Adviser's Predicament

Advisers who buy a book of business are saddled with debt, only to find that the value of the business is plummeting due to the "Fee for No Service" issue. This puts advisers in a precarious situation. Under the "fit and proper" rules, advisers with outstanding debt become unemployable, leaving them in a financial and professional abyss.

The Domino Effect

The problem doesn't stop here. Advisers who find themselves in debt may face legal repercussions, further diminishing the value of their business. This creates a vicious cycle, affecting not just the advisers but also the clients who are entrapped in a failing system.

The Way Forward

  1. Transparency: Advisers must be transparent about the fees they charge and the services they offer.

  2. Regulatory Oversight: The FCA needs to step up its game and take decisive action against firms that engage in the "Fee for No Service" practice.

  3. Client Empowerment: Clients must be educated about their rights and the questions they should be asking their advisers.


The "Fee for No Service" issue is a ticking time bomb that needs immediate attention. Advisers must act responsibly, and regulatory bodies must enforce stricter guidelines to protect both clients and advisers from falling into this financial abyss.

For those interested in transitioning from a Financial Intermediary to a Non-Intermediating Financial Planning firm, the Academy of Life Planning can assist in this journey. Let's work together to bring integrity and transparency back into financial planning.

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