Towry transfer delays costing Ascentric £15k a month

Ascentric says delays in the transfer of £75m worth of Towry assets on to the platform are costing it £15,000 per month, as a dedicated team battles to sort out the “extraordinary” and “embarrassing” problem.

Managing director Hugo Thorman (pictured) says the wrap is facing delays of up to four months to make the transfers and has criticised Towry for its "inefficient" handling of the problem.

The assets waiting for transfer to the platform are those of former clients of Edward Jones, which was acquired by Towry Law last October.

However, an issue has arisen concerning the custody of these assets, which are now held by Towry in a nominee account. In order to transfer assets, Towry has to send stock transfer forms to the relevant fund management group which then transfers custody of the asset to an Ascentric nominee account.

According to Thorman, these transfers are coming over far too slowly and this is having a detrimental impact on consumers.

"What upsets us most is what it is doing to our clients," he says. "It is very frustrating because advisers and clients think we should be doing more but we are doing all we can - we are in daily contact with Towry. It is difficult to know what else to do."

He says the Royal London-owned wrap has had to hire a specialist seven-member team to deal specifically with the transfers. The team, which has been in place since March when the majority of the transfer requests were made, is costing £15,000 in resources every month to run.

Thorman thinks Towry may have been overwhelmed by the sheer volume of the Edward Jones backlog.

"Towry needs to put more effort into dealing with this," he adds. "This is very embarrassing, expensive and frustrating for us. They are doing what they can but for us it is too slow and inefficient."

A senior figure at another platform, which is also trying to transfer Towry assets, said the delays are now running into months and calls on the FSA to introduce a re-registration time limit.

"Advisers are getting very cross and sometimes their anger is directed at us," he says. "Advisers do not know if the delay is down to us or Towry."

He also revealed a problem with dividend reconciliation, whereby paperwork from Towry informing fund managers of a change in nominee is being held up.

"An integral part of what we do is apportioning dividends between the number of clients who are entitled to receive them," he says. "Towry should have notified fund managers that assets are being transferred to our platform but we have not had the paperwork from them.

"As a result, we do not know which clients are entitled to a dividend. The more dividends that come in the more of a nightmare this is for us because we cannot pay out dividends until they are reconciled."

Meanwhile, previous Edward Jones clients have launched an online petition - Treating Customers Shabbily - calling on the Government to look into the asset transfer delays.

Towry insists it is working as quickly as possible to resolve the issue.

"We apologise to any clients who may have been inconvenienced and can confirm that we have invested heavily, through recruitment and diverting experienced internal resource, to expand the administrative team involved with transfer," it said. 

"We wish to clear the backlog as soon as possible and have kept the FSA updated with our progress."

In April, Towry was granted an interim injunction against six former Edward Jones advisers accused of soliciting its clients. The High Court hearing is expected to take place in the Autumn.