by Rob Hosking
Stacey circulated an open letter to other advisers, claiming that the proposed agreement, effectively means those financial advisers who sign end up being tied to Tower.
“When you see things like you start to think that Gareth Morgan has a point,” he told Good Returns.
The effect of the agreement would validate much of Morgan’s well-publicised criticism of the industry, he says. It would mean advisers who sign are Tower’s agents, rather than independent financial intermediaries, and that, he says, is not only a bad look in the current climate, but “disrespectful of investors.”
Tower, for its part, say the agreement is not a lot different from earlier agreements – but the company also says it will take a look at the offending clauses.
‘It think he’s read too much into it,” says national sales manager Kerry Ford. “There will be some amendments – we’re still looking into what they will be – but a lot of things were in the previous agreement.
“The fact is, we don’t’ handcuff advisers – unlike some others.”
The agreement, says Stacey, is reminiscent of earlier bids by the National Bank and ING to try to tie advisers more closely into marketing their products. Those earlier attempts failed, he says, and he believes Tower’s agreement is in the same category.
His open letter has circulated widely throughout the industry and he says some people who have signed Tower’s agency agreement have told him they now regret it.
Meanwhile Tower’s Kerry Ford says he expects a revised offer will go out to advisers by the end of the week.
Rob Hosking is a Wellington-based freelance writer specialising in political, economic and IT related issues.
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