"So we're really going to do this Treating Customers Fairly thing twice in a row?" asked the chairman of the improbably-sized investment company Prandeamus Asset Management when I dropped by to see him this week.
"And all because Prando's decides it doesn't want to play the direct-client game any more and has arranged to transfer some £650 of assets it holds on behalf of seven clients to another platform?"
"Top recap on last week," I nodded. "And, yes. We are. As I mentioned last week, I think there are some big and moderately interesting questions to be kicked around here, including - if I have cut-and-pasted correctly - did you consult the clients about what they wanted? Are they even technically direct clients anyway? How many of your magnificent seven had financial advisers and did you talk your decision through with them either?
"And, more philosophically, if there are advisers involved, what do we think about the idea of an asset manager selling one intermediary's clients to another intermediary? All of which could, I reckon, feature within a wider discussion on the spirit of TCF, which - for the avoidance of doubt - is in no way the same as saying you or anyone else has been Treating Customers Unfairly."
"Right," said the chairman, carefully studying a piece of paper he had pulled out of his pocket before reading out: "‘Always pretend to sympathise with the journalist's point before telling them why they are deluded' ... ah ... I don't think that bit was for your ears. Still ... um ... of course I understand where you're coming from and of course you make some interesting points but just let me tell you ..."
"Why I'm deluded?" I interjected helpfully. "Just let me tell you some ideas you may have overlooked," said the chairman firmly. "Like, for example, with regard to your question about whether those seven Isa investors are direct clients of ours, we would argue the bigger issue is that no business within the wonderful world of investment can ever claim to ‘own' clients.
"As such, we see our investors as perfectly free to move to any platform they so wish at any time before our deadline, just as any advisers they may have are perfectly free to get in touch with them to offer their own input on what they do next." "Fair enough," I conceded. "Though on your latter point, it does of course mean advisers expending time and energy as a result of decision on which they were not consulted.
"And on the former point, what percentage of the seven do you really expect to make the extra effort to move? Basic inertia ..." "Think very carefully before you say anything disparaging about inertia," warned the chairman. "Some of the greatest brands in Her Majesty's financial services industry have been built on people being too lazy, apathetic or confused to take positive action."
"Are you sure you're making the point you think you are?" I asked. "What is more, the underlying thrust of my argument potentially goes a lot further than asset managers deciding they do not want to play with direct clients any more ..." "‘Concluding direct clients can be better served elsewhere'," corrected the chairman. "Potayto, potahto," I replied.
"My point is, the levels of bulk client-shifting in those instances will be as nothing as the levels of platform-related consolidation we have started seeing eventually picks up pace. As some of the platform giants start hoovering up the assets of competitors - and indeed of advisers planning an exit - then there will be an awful lot of people who wake up one day on a platform they had no part in choosing.
"And in an industry hardly awash with trust and goodwill, and a regulatory environment where competition, transparency and the wellbeing of the end-user are supposed to be paramount, are we absolutely sure these non-consultative package deals are 100% in the spirit of TCF?" "But that's the way it has always been with mergers and acquisitions," the chairman protested. "Be it the clients of insurance firms, the holders of endowment policies, the customers of high street banks and ... ohhhh - I begin to see what you mean."
