True and Fair Campaign comment on the IMA’s Annual Asset Management Survey
Commenting on the IMA’s Annual Asset Management Survey, Gina Miller, co-founder of the True and Fair campaign stated:
“The IMA’s statement that investment clients are paying fund fees of ‘a fraction over 0.3% across the board’ is absolutely ludicrous and clearly underlines the need for statutory protection for consumers to ensure they have full disclosure on fees and costs and total transparency on what they are paying for their investments.
“An analysis by SCM Private of 3,401 IMA active retail funds with combined assets of over £1 trillion found that the most common annual management fee was 1.5% pa and the overall average Total Expense Ratio was 1.63% pa.
“Savers in the UK are being completely misled by hidden fees and charges and utterly false statements like this by the IMA show the depth of the problem. If the IMA is to restore a modicum of respect back to this vital industry, it needs to stop behaving as the artful dodger from Dickens and start telling the truth for once.
“Our own analysis shows that just the hidden costs, including dealing cost, of investment funds will often amount to 1% a year, with some funds charging significant up front charges or performance fees, on top of the typical quoted 1.63% pa charge. The real figure for fund fees and charges is therefore closer to 3% pa to consumers, rather than the 0.3% pa alluded to by the IMA.
“The scale of hidden charging in the UK investment industry is a scandal and the IMA’s continued attempts to pull the wool over both consumers’ and regulators’ eyes as to the true cost of investments is a disgrace. We have to give 100% disclosure on all fund fees and costs, through one number that allows consumers to compare costs and performance across different fund managers and make an informed choice as to which product provides the best value for them.
“This is not a complex or controversial demand and it is entirely within the interests of the consumer. It is time the IMA understood that fund managers’ £4.2 trillion of assets is not their money, the funds belong to ordinary savers and pensioners and these people deserve real value and total transparency on what they are paying – not this sort of misleading claptrap.”
Posted By: True and Fair, 10:41 am