The Wealth Net: True and Fair Campaign calls for transparency for investors
An overwhelming majority of Britain’s savers and investors want full disclosure of the investment fees and charges levied by investment companies with more than 90 percent saying that firms should be legally obliged to provide this information, according to a new report from SCM Private founded The True and Fair Campaign.
The report marks one year since the launch of The True and Fair Campaign, which continues to call for a fair and transparent deal for consumers, and demonstrates just how important the issues of transparency and fee disclosure are.
Almost three quarters (74 percent), of investors questioned said they wanted costs and fees disclosed as a single, cash figure – something The True and Fair Campaign has been urging as a benchmark to enable simple comparisons between financial savings and investment products.
The findings also highlight the value savers place on understanding what they are paying for. 84 percent of those polled said that it is very important they understand the fees they pay for investment or pension products, and yet more than half (58 percent) said they did not know the cost of their current products, including fees.
Gina Miller, founder of The True and Fair Campaign said: “This latest research shows how much savers and investors care about the money they’re being charged by their investment providers. A year ago, just after we launched The True and Fair Campaign, the former head of the industry trade body, the Investment Management Association (IMA), Richard Saunders described the industry’s hidden charges as ‘a myth.’ One year on the results of this survey prove that savers do not agree with this analysis and feel that statutory disclosure of costs and fees is the only solution to end the scandal of hidden charges.
“It is completely indefensible that two thirds of people buying investment products do not know how much they are paying in fees and charges. But what is worse is the fact that while we call for transparency and 100 percent disclosure, the industry continues to hide under a thin rhetorical veil promising more disclosure, not full disclosure, and wraps itself in opaque, ill-defined guidelines.”
The survey also revealed that just 42 percent of investors know approximately how much they pay in fees and charges. Those who are aware of fees and charges think they are paying about 1.58 percent for their investments, compared to the 0.3 percent that the IMA claimed investors paid in its 10th Annual Management Survey, released last year. However, based on analysis by the True and Fair Campaign, once all the extra hidden costs, fees and charges are added in people are often paying closer to 3 percent.
“It is time for the industry to come clean before consumers vote with their wallets and opt to avoid hidden charges by investing their money elsewhere”, Ms Miller added. “We continue to call on the industry regulators to sign up to our six point plan to ensure the protection of consumers and begin to regain their trust.”
Posted By: True and Fair, 9:11 am