NAB/MLC retained grandfathering to retain planners
NAB/MLC decided to pursue keeping grandfathered payments to financial planners as part of a successor fund transfer (SFT) process because of its concern that planners and their clients would take their business elsewhere, the Royal Commission was told today.
Giving testimony before the Royal Commission into Banking, Superannuation and Financial Services, former MLC/NAB executive, Paul Carter acknowledged that it had been open to NAB/MLC to abandon the grandfathered payments, but it had chosen not to.
He said that this was because of the contractual arrangements with the planners and the likelihood the planners would be dissatisfied and take their business elsewhere.
However, Carter later acknowledged under questioning from counsel assisting the Royal Commission, Michael Hodge QC, that contractual arrangements with the planners would not have been an issue for the trustee of the fund, NULIS.
Hodge asked whether, given advisers’ best interest obligations, it would have been wise to move clients out of commission arrangements.
Carter said he believed the two positions could be reconciled because of the MLC products were available to the clients.
Seeking clarification of what had occurred, the Royal Commissioner, Kenneth Hayne sought clarity from Carter around what had been pursued was a platform transfer rather than a successor fund transfer.
Recommended for you
It can be extremely hard to realise the gains from financial advice M&A, according to Peloton Partners’ Rob Jones, and more could be gained from firms looking inward at their own practice.
With platforms reporting their quarterly results, there is a clear divide in the adviser markets they are targeting, according to platform specialist Recep Peker, and which would be right for your clients.
The Federal Court has imposed a $10 million penalty on Macquarie Bank for failing to prevent and control unauthorised fee transactions by third parties including financial advisers.
A financial advice firm has seen a weekly decline of 10 advisers, with all moving to a new licensee, while Centrepoint Alliance continues its “growth story”.
