Gina Miller calls for FCA to scrutinise wealth managers on fees

Miller Gina SCM

Gina Miller has called for the FCA to apply equal scrutiny to wealth managers as it does to the funds industry ahead of this week’s release of the regulator’s asset management market study.

SCM Direct, the investment boutique she founded with her husband Alan, investigated fees and expected returns from 31 of the UK’s “biggest and best known” wealth managers overseeing £440bn, the Financial Times reports.

Under the research, the company approached wealth managers from a fictional email account seeking to achieve more than 7 per cent annually by investing £1m with 70 per cent in equities and the remainder in cash and bonds.

SCM Direct estimated a reasonable net annual return would be 3.9 per cent; however, more than half of wealth managers said they could expect to deliver more than 7 per cent after fees.

Miller described this as “completely false marketing and not realistic in any way”.

More than half of the wealth managers failed to provide a breakdown of costs even after SCM Direct pressed them for further details.

“At the moment, all of the focus is on asset managers. But over 80 per cent of [individual] investors still use an adviser, be it an independent financial adviser or a wealth manager,” Miller says.