Succession Wealth Management Limited · DRN-6295181

The complaint Mr and Mrs S complain that Succession Wealth Management Limited (“SWM”) unfairly charged them a monthly retainer fee. What happened Mr and Mrs S had been clients of a financial adviser, who I’ll call Mr X, for some years. Mr X had two companies – A1 and A2. A1 was a regulated financial advice company, and A2 was unregulated, and through which Mr X gave general financial planning advice. In 2017, SWM bought A1 and A2, and Mr X became one of their advisers. Mr and Mrs S signed SWM’s terms of business and became their client, with Mr X remaining their adviser. As part of SWM’s terms, Mr and Mrs S agreed to pay them an annual fee for ongoing advisory services. They also transferred a standing order mandate for a fixed monthly retainer fee, which they’d previously paid to Mr X, in favour of SWM. In 2023, Mr and Mrs S complained to SWM. They said they didn’t think they should have been paying the monthly fixed fee in addition to SWM’s annual, percentage ongoing advice charge (OAC). They didn’t think SWM had set out what the monthly retainer was for, or provided any additional services in return for it. SWM said the retainer was a continuation of a separate agreement between Mr and Mrs S and Mr X, for unregulated services which weren’t covered by SWM’s terms of business or service offering. They offered to refund the fees which had been taken since Mr X had left SWM in 2022, but didn’t think they needed to refund anything from before that. Mr and Mrs S brought their complaint to our service. SWM said they didn’t think our service could consider the matter as the retainer related to unregulated services and so the complaint didn’t relate to a regulated activity. Another ombudsman issued a decision concluding Mr and Mrs S’s complaint was outside the scope of our service’s jurisdiction. Since then, we have received a number of similar complaints about clients of Mr X and retainer fees paid to SWM. Following information coming to light in those investigations I now consider this complaint to be within our service’s jurisdiction to consider. And so I issued a provisional decision in which I said: Firstly I will address the fact that another ombudsman had previously decided this complaint wasn’t one we could consider. Whether a complaint is in our jurisdiction or not is a question of law, to be decided by the ombudsman on the facts (as explained in R (Chancery) v Financial Ombudsman Service [2015] EWHC 407 (Admin)). So the previous ombudsman’s decision didn’t cause Mr and Mrs S’s complaint to fall outside our jurisdiction. It either is or it isn’t. There is a right or wrong answer. For the reasons I’ll explain I’m satisfied that the right answer is that our service has the power

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to consider this complaint. This is a case where the jurisdiction and the merits of the case are closely intertwined. What I’ve had to decide is whether the fee complained of was, in fact, for solely unregulated services. And if not, whether it was reasonable for SWM to have charged it. Under the DISP rules which our service is bound by, we can consider complaints about regulated activities, and any ancillary activities, carried on in connection to a regulated activity. SWM’s position is, briefly, that Mr X agreed to provide unregulated services to Mr and Mrs S in return for the retainer fee, and that these services didn’t form part of SWM’s annual advice offering. and were offered to provide continuity. SWM said that these unregulated services would “generally be something our business would agree a cost with the client beforehand, to be invoiced”, but here were provided in the same way as had been the case before they acquired Mr X’s firms “to provide a continuity of service”. SWM relies on internal emails from Mr X, where he says that the retainer was to provide “a financial representation of that value for each client, separate from the commoditised percentage charge of running their money”. Where the “value” was given to include the personal relationship with the adviser, and non-transactional work such as pension analysis, tax planning, liaising with their accountant and helping their kids. Mr X also sent emails after Mr and Mrs S’s complaint was raised, and there his version of events is somewhat different. There Mr X says “there was no contractual basis for the payment once the old [A1 and A2] client agreement […] fell away”. He also says of the unregulated A2 that it “was in a separate non-regulated company (which became Succession Independent Schools once acquired). This non-reg company had a clear client agreement with regards to the retainer, that the client agreed to and signed”. I’m also mindful of the fact that – according to Mr X – Mr and Mrs S had a separate client agreement with A2 for the unregulated services, with a retainer. And that A2 became Succession Independent Schools. I’ve not seen anything to suggest Mr and Mrs S had any relationship or agreement with Succession Independent Schools. What Mr and Mrs S did have after SWM’s acquisition of A1 and A2 was a relationship with SWM. The ysigned a terms of business, as well as a standing order mandate for the retainer. The standing order change was in response to a letter from SWM (via Mr X) saying that by making the payment Mr and Mrs S were “guaranteed to retain me as your adviser”. Mr and Mrs S signed up for SWM’s Premier Wealth Management Service. SWM’s fee schedule said that this would cost 1% a year of the value of their portfolio, and would be for things including an annual planning meeting, an assessment of the tax efficiency of their financial arrangements, providing strategic updates to their accountant or other professional advisers, amongst other things. I’ve also considered a copy of a client declaration for Mr X’s old firms. This isn’t Mr and Mrs S’s declaration, but I think it’s likely Mr and Mrs S’s would have been similar as I’m not aware it changed materially. This agreement, signed in 2013, signs that client up

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for Mr X’s “wealthbuilder” programme – which is subject to a fixed monthly fee. It’s notable that the agreement doesn’t list any percentage charge, and it appears to be for A1, the regulated arm of Mr X’s business, and not A2, which Mr X said had its own agreement and retainer. I’ve thought carefully about the above. Where evidence from the time is incomplete and conflicting, as it is here, I have to base my decision on what, on balance, I think is more likely than not to have happened. Having done so, I currently find: • A2 had its own agreement and retainer, and became Succession Independent Schools. Mr and Mrs S have no relationship with Succession Independent Schools. • Clients paid a fixed monthly fee to A1, which provided regulated financial advice. • SWM said in its fee schedule that their OAC included activities which I consider to be ancillary to the regulated advice it was giving – such as considering the tax efficiency of arrangements. I think things like looking at tax implications of investments and liaising with an accountant would be likely to relate to the result of investment advice or predicate further regulated advice – and so I consider them in these particular circumstances to be ancillary to that advice. • SWM also said it would detail any additional services it provided and charge for them individually. There’s no evidence of it doing so for Mr and Mrs S. • While SWM said it didn’t do that due to the legacy arrangements here, I can’t see that that was explained to Mr and Mrs S in writing at the time of the acquisition. The only reference to the retainer at the time was the letter saying it was to “retain” Mr X as an adviser. • I’ve seen nothing to suggest Mr X provided any additional services to Mr and Mrs S after he moved to SWM. • I think it’s likely that the retainer paid to A1 was, similarly to the OAC SWM charged, for ongoing regulated advice and ancillary activities to that advice. • I therefore find that this complaint relates to activities we can consider. So overall I currently find that the monthly retainer SWM charged Mr and Mrs S was for basically the same thing as the OAC it also charged. I’ve not been persuaded that it was for specific unregulated services as SWM says. Even if the fee was simply to ensure Mr and Mrs S had Mr X as their adviser, rather than any other employee of SWM, I find that to be within our scope as it would relate to the adviser who’d be giving Mr and Mrs S regulated advice. If the retainer was in effect duplicating the OAC, then I don’t think it would be fair for SWM to have charged it twice. And so I think they should refund the retainer. And if it was to ensure Mr X remained Mr and Mrs S’s adviser, I also think it should be refunded. SWM, as they’ve said, could choose which adviser to allocate to a client. And they needed to ensure they acted in a client’s best interests. I’m not persuaded it was in Mr and Mrs S’s interests to have to pay a fee each month just for SWM to give them the same adviser. Especially as this involved no cost to SWM. And I note that the idea of paying for a particular adviser isn’t mentioned anywhere in SWM’s literature or fee schedule. In conclusion I currently find this case within our jurisdiction to consider, and I find that the monthly retainer fee Mr and Mrs S paid to SWM wasn’t fairly or reasonably charged. So I think SWM should refund any retainer payments it hasn’t already paid, along with 8% simple interest from the time it took the payments until the date it settles this complaint. Like our investigator, I think this caused Mr and Mrs S some distress and inconvenience, and agree that SWM should pay a further £150 to Mr and Mrs S in light

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of that. Mr and Mrs S responded to say they accepted my provisional findings. SWM didn’t reply before the deadline I’d set. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Having done so, and as neither party has raised anything new in response to my provisional decision, I see no reason to depart from my provisional conclusions. I therefore make the same findings here and make them final. Putting things right SWM should refund any retainer payments it hasn’t already, along with 8% simple interest from the time it took the payments until the date it settles this complaint. It should also pay Mr and Mrs S £150 for the distress and inconvenience it caused them. My final decision For the reasons given here and in my provisional decision, I uphold this complaint and direct Succession Wealth Management Limited to pay Mr and Mrs S compensation as set out above. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr S and Mrs S to accept or reject my decision before 14 May 2026. Luke Gordon Ombudsman

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