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  1. #1

    Fee structure for Dicretionary portfolio management

    Good afternoon all members
    I contact you because I have a question , after I sold my business in 2015, I sign a contract with Barclays for a jersey discretionary portfolio moderate risk. This product at a fee structure after a negotiation with the banker, they offer me 0.95% of the value of the portfolio. On the leaflet the fee was call Advisory portfolio management, annual fees ( Advise and custody ) , you can see also additional third-party cost like government levies and tax, brokerage cost and product cost such as annual management charges for fund, ect. The example was 50 or 25.You can read in one of the pdf give to me , All in One fee structure. No other fee was mention anywhere on the letter offer, leaflet pass to me or in my account opening form. Few month ago I was in touch with another bank HSBC , we discuss about my portfolio and my portfolio fee, I say to him I have a 0.95% fee all in. The banker of HSBC say to me that was wrong, more fee are take from my account, he say I suppose to have a OCF fee , we were unable to find that on my 6 month report portfolio from Barclays or other paper from Barclays. I was surprise but because I didn’t move more with HSBC, I say nothing to Barclays. This week , I contact barclays again, my new banker I ask her, to send me a OCF report, she send me a report , cost and charges disclosure, she say it is a new document that is now required when a new customer invest for the first time, and also when they are topping up a portfolio.
    I was very surprised and chocked about this report, in the summary of the cost, you have 2 cost, service cost 0.95% ( fee negotiated with my banker when I sign with them ). But now I can see a product cost at 1%, I never heard about this fee, never see this fee in my report for the last 30 month. This fee are more important of my other fee, why I never been advise about that, why barclays never give me a OCF fee before.
    I check all email, reports, leaflet, ect, this fee are never been mention, only one fee was mentioned to me.
    I would like to know the rule and law about that before to complain to barclays because it look like no transparency has been done about my fee structure, I don’t think it s fair for me or the customer right, because this other fee are more expensive.
    I look online, it look like new rules was Introduced in 2014 for fund charges more transparent, and also obligations to show the OCF must publish it once a year.
    Thank in advance for your reply and help.

  2. #2
    OCF only applies to certain assets. Not all assets. For example, life funds and pension funds dont have an OCF.

    Also, charges layouts changed in January 2018. So, it would be unfair to look at historic charges documents and expect them to say the same as post January 2018 documents.

    Of course, the HSBC rep should know this but a common "salesman" type approach is to poo poo the alternatives to make you think they are better. It shouldnt be happening in this day and age but it does. Or it could be that, as you say it was a clerk, that they dont understand the charges disclosure requirements and the rule changes that have occurred.

  3. #3
    unbundling of charges and new calculation methods will have some differences but the actual amounts shouldnt have changed.

    The UK moved to unbundling on many contracts back in 2013 and was ahead of Europe. However, offshore investments did it years later and many only did it this year.

    Banks are notoriously expensive and generally low quality in their product offerings. You should seek out an IFA in Jersey (or equivalent) and put the questions to them.

  4. #4
    Thank for your reply, I send this post because I would like to know the rule and law about this fee structure because like I say until this Monday I never heard about this product cost. All the paper I have with Barclays and email exchange with banker when I open this discretionary portfolio management was 1 fee, under the PDF I received from the banker in Oct 2015, It was mentioned All in one fee structure and after the fee cost, it was 0.95%. Now like I say I am surprise to heard about this product cost who never been mentioned to me. Plus this fee are more important of my other fee, I don!!!8217;t think transparency has been done about this fee.
    Why I never see this other fee in my report for the last 30 month.
    Is it legal to do say to the customer all the fee it will pay ?
    About the HSBC bank, I know he was doing his job, but that was before January 2018, and he say to me I was suppose to have OCF fee because it is the only way to compare fee on portfolio
    Now after this email Monday, I contact Barclays and they sound little embarrassing about that, they call me on they say it was maybe mentioned quickly verbally. But like I say I send few email to them about this fee structure and they never mentioned them.
    Before to go him them, my account and a good friend recommended me IFA brooks..... ( I don!!!8217;t know if you are allowed to mention name ) , on them offer, I have 2 part fees, service and product fee, all together was around 1,35% with a warning because the fee will maybe little higher the first year because need to build the portfolio. My banker ask me to see this fee for beat them, and it is for that he offer me a flat fee at 0.95% but he ver mention other fee. Now it look like I pay 0.7% more fee, it is around 30k by year. It is a lot of money
    Where I can find if Barclays give me when I sign all the info I need and since that if the documents I received from them are good and why never received OCF

  5. #5
    I forgot to mention, when I spoke to my barclays management this week after I receive this fee structure, I spoke with my new one and old one. They say maybe I only mentioned this product fee verbally to you when we talk. Because this fee are more expensive of the other, I don!!!8217;t think that it is honest and transparency from Barclays, I don!!!8217;t know if that is legal.
    The other thing it s I don!!!8217;t know how much it cost me for the last 30 month because I never receive any information about this fee.
    Also they say to me straight away , yes but your portfolio done a good return in the last 30 month and the return is net, fee take. I say yes but I add, when he sold me the product he say my portfolio will be better of beachmark, but after 30 month, my portfolio is under by 1.2%.
    And they pass to another subject


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