Consumer duty Actions
Consumer Harms
Based on our interpretation of the Consumer Duty rules we have identified some groups of investor clients, where we believe there could possibly be consumer detriment. The breadth of our assessment is summarised below. As with all types of portfolio and asset assessment there may be very valid reasons why a portfolio holds certain assets or has a certain status. The table below indicates where our mutual clients could benefit from some further investigation by you or us.
We will be sharing targeted communications with you over the next few months aimed at advisers and we do not plan to communicate to our mutual clients directly, unless ultimately we need to close a portfolio.
| Initiative | Objective |
|---|---|
| Closing portfolios valued at less than £50 | We aim to close dormant portfolios (that are in a family group or single portfolio with a total value of under £50) that have had no activity for 12 months or more. |
| Low value portfolios where the Transact fees in the last year exceed 2% of the value of the client’s portfolio. | To raise awareness of low value portfolios that are impacted by Transact’s charges. They are potentially losing value by more than 2% p.a. |
| A DIM has been appointed and there is no model or template linked to the portfolio. | Where a DIM has been appointed, but there has been no Template/Model linked to the wrapper for some time we will inform you that the DIM will be removed and no further DIM charges will be applied. |
| Portfolios in a negative cash position or are showing pending fees | We are assessing the removal of long-standing negative balances and pending fees within some portfolios and their closure. |
| Concentration Risk - Single Stock | We wish to raise awareness where clients hold only a single stock in their portfolio. This does not include collective investments and we appreciate that there may be an entirely valid reason for holding one stock. |
Vulnerable Clients
We are continuously looking at ways of enhancing our processes to ensure that we can easily identify why a client is vulnerable and the type of additional support they might require. This helps us to consistently deliver good outcomes to clients where we’ve been told they have characteristics of vulnerability.
With ‘Consumer Duty’ just around the corner, the FCA has reiterated that the new obligations apply to all firms in the distribution chain and we wanted to remind you of the importance of letting us know if any of your clients could be considered vulnerable even if at this stage, they do not require any additional support from us.
If you do have any vulnerable clients, please contact your Client Service team to let us know and tell us how we can assist them.
- Introduction
- Transact Online (TOL) – Recent Enhancements
- Transfer Due Diligence Pension Scams
- Consumer Duty Actions
- Over 54% of Investor Clients have Logged in in the Last year
- Share Class Conversion
- Transact- BlackRock MPS Update
- Dealing with Pension Income Payments in Times of Uncertainty
- Fund Changes
- Interest on Cash Deposits
- Transact Events 2023