IFA firm Chase de Vere has been accused of perpetuating a “hard selling culture” as it awards its top-selling advisers with cruises in a move reminiscent of St James’s Place’s sales perks.
In January, the £10bn ($12.9bn, €11.8bn) advice firm hosted a ceremony, where chief executive Stephen Kavanagh awarded the advisers able to generate the highest fees with a three-day all-expense paid cruise for them and their partner to Cannes, according to an investigation by The Times.
The top 10 sellers raked in between £723,000 and £1.3m from customers last year.
As advisers came onstage to collect their award, the fees they had collected over the year were prominently displayed on the big screen at the four-star Principal Hotel in Manchester, where the company’s annual conference took place.
‘The whole event is about the money’
An attendee of the conference told the newspaper Chase de Vere was sending the wrong message by “applauding sales”.
“The focus of the whole event is about the money, not just the money the firm made but the money the individual advisers made,” they said. “It should be all about doing the right thing for our customers.”
Another source accused the firm of promoting a “hard-selling culture”.
According to The Times, the company circulates a league table every month outlining how much advisers have made in fees. Advisers described feeling under pressure to move savers’ money and deliver extra income for the company.
Sicily and Athens are among the destinations for the cruise holidays awarded to advisers.
Top seller rakes in more than Hargreaves and SJP bosses
Chase de Vere advisers earn a base salary ranging from £18,000 to £65,000, but the top fee generators can walk away with significantly more, receiving around half the fees they draw from customers.
The top earner last year banked an estimated £670,000 out of £1.31m in fees, which The Times pointed out was more than Hargreaves Lansdown boss Chris Hill’s pay (£648,000) and SJP chief executive Andrew Croft’s (£533,000).
Advice firms have been under the microscope for lavishing advisers with expensive rewards and putting sales ahead of customers’ best interests.
SJP was slated for its own controversial perks system in which top sellers were similarly awarded with all-expenses paid week-long cruises as well as diamond encrusted cufflinks for meeting aggressive sales targets.
The FTSE 100 wealth manager has since scrapped the cruises and overhauled its rewards system in order to encourage “the right behaviours” from advisers.
Company culture ‘willingly misrepresented’
Chase de Vere’s Kavanagh said The Times story paints an inaccurate picture of its company culture and said the advice firm operates in “an entirely transparent and accountable manner” regarding its services and fees.
“We are disappointed that The Times has willingly misrepresented our company culture and operations,” he said. “The results that we achieve for our clients and the overwhelmingly positive feedback that we receive demonstrates the quality of service provided by our advisers.
“We have robust controls in place to continuously monitor the activity of our advisers to ensure that they, along with all of our employees, operate in the best interests of our clients at all times,” he continued.
“Our client-focused processes and quality controls ensure that we reward only those employees who are exemplary performers and we are proud to celebrate their achievements for our clients.”
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