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Senior Partner
Senior Partner, Solicitor
Category: Law
Satisfied Customers: 13329
Experience:  Solicitor with more than 30 years experience
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I am an Independent financial services company- I am the principal

Customer Question

I am an Independent financial services company- I am the principal of my firm- Directly Authorised by the FCA- I had an appointed representative who I appointed in FEB 2014 and subsequently Terminated them in Oct 2014- I terminated their AR status because the director of the AR firm had applied to another IFA company and set up as a new AR company under a new IFA- Basically in the 6 months they were with me i trained them to sell only Life Insurance as a non advised sales process over the phone direct to clients. This was done by way of cold calling- They used their own marketing data to contact clients- When I found out that they had set up under another IFA i confronted them and they stated they wanted to stop with immediate effect placing business through me as it was not financially viable- However they had already set up and was conducting business un be known to me for a month prior with another firm- since this they have started to re write or churn the life insurance cases that I had already paid them commission on - Cases they submitted via my licence for the 6 month period. I have had to repay the commission liability for the cases plus I am responsible for any complaints that may arise in the future or any mis selling etc. I am looking to take action against them for breach of contract- I have a photocopy only of The AR agreement that they signed originally as they kept the original document. It clearly states that clients belong to the principal firm however they are saying that the photocopy I have was not signed by their director at the time and its false. They are saying this I believe in an attempt to muddy the waters? I am seeking advice as they have no signed document from me stating the clients are theirs at all. I am looking to see if there are any previous cases that have gone to court that I could use to show that the clients are ownership of the principle firm as I intend to take court action against their company. I am seeking information on costs for me to take them to court- Client ownership- loos of 6 months income and basically I set them up and trained them for them to start elsewhere leaving me at both financial loss and loss of my time. I believe proof is based on the balance of probabilities that a judge has to look at. Many thanks
Submitted: 3 years ago.
Category: Law
Expert:  Alice H replied 3 years ago.
My name is***** and I'm happy to help with your question today.
How much do you estimate your total losses to be?
Customer: replied 3 years ago.

Hello Alex- Thanks for your response- Since the closure on 11th November- I have incurred 60k of claw backs and repaid this liability back to the life Insurer L&G who I use for the AR route. Also i was looking for 6 months of lost income- Min of 3k per week x 26 weeks- plus any legal costs I would incur etc. I hope this is sufficient

Many Thanks


Expert:  Nicola-mod replied 3 years ago.
It seems the professional has left this conversation. This happens occasionally, and it's usually because the professional thinks that someone else might be a better match for your question. I've been working hard to find a new professional to assist you with your question, but sometimes finding the right professional can take a little longer than expected.
I wonder whether you're OK with continuing to wait for an answer. If you are, please let me know and I will continue my search. If not, feel free to let me know and I will cancel this question for you.
Thank you!
Customer: replied 3 years ago.

I am happy to wait for another professional- Roughly how long will this take.

Many Thanks


Expert:  Nicola-mod replied 3 years ago.
I'm afraid JustAnswer cannot guarantee a time, however most questions are answered in a timely manner. We will continue to look for a Professional to assist you.
Thank you for your patience,
Customer: replied 3 years ago.

That's fine Thanks

Expert:  Senior Partner replied 3 years ago.
Hi thanks for your question. From an FCA perspective you ought to have had a proper written agreement to appoint an AR but as a matter of general law it is not necessary to have a singed copy of the agreement if there is clear evidence of the terms agreed. It is pretty clear that it must be implied that where you have accounted to them for premium on business that they wrote and it is clawed back because they have rebroked the business then you are entitled to recover the clawback from them. The ownership of the client in
the sense of who retains the right to broke business to them is debatable and I wold be doubtful if you can prevent them form doing business with clients they introduced to your firm when they were acting as AR under your umbrella. I think you must have a pretty clear came however for recovery of the clawback commission, Given the amount this will probably have to go to the high court and you would be wise to get a solicitor.
you may feel also have a claim against them for breach of contract generally. I do not think the FCA would like their conduct either but if you complain to the FCA it may put them out of business which may make it difficult to recover your money.
They also sound dishonest which doe not help in getting recovery. I would go to a solicitor and pursue a claim vigorously. You may be able to do something to charge their commission trail to recover.