RDR changes DFM Payments CP12/27
Another update to the rules slipped in to the quarterly consultation CP12/27. In effect it clarifies what was guidance and confirms that DFMs should not be paying financial advisers for referring clients to them in the same way as product providers cannot pay commission and rebates to platforms will be banned next year.
The rules make it clear that any service provided in respect of a DFM agreement is a related service and as such is caught by the adviser charging rules. There remains the possibility that a referral could be made where the adviser has no further involvement and can be paid for this but this is subject to consultation and the loophole may also be closed in due course.
Contrary to some press comments this has nothing to do with platforms facilitating DFM payments, which will still be possible.