By Lois Vallely 19th January 2022 3:27 pm
Source: https://www.moneymarketing.co.uk/news/tenet-plagued-by-relentless-exodus-of-member-firms/
Adviser members continue to leave network Tenet Group (Tenet) in their droves, amid complaints about technology and system issues.
Money Marketing understands that Tenet has also released a number of firms which do not, or are not willing to, meet new standards such as the Consumer Duty, or which no longer suit its proposition.
Since 1 December 2021, 14 members have left Tenet Lime (mortgage adviser network) and a further 15 have left Tenet Connect (financial adviser network), according to the financial services register.
Meanwhile, seven members have left the compliance provider arm Tenet Connect Services. This means a total of 36 appointed representative (AR) firms have left the network in less than two months. At the time of publishing, the most recent to have left were Cosy Castle Financial Solutions – which left Tenet Lime on 10 January – and Affable Wealth Management – which left Tenet Connect on 7 January.
Meanwhile, no new firms have joined any of the three divisions since November last year.
In February 2019, Tenet signed an initial five-year contract with Intelliflo for the provision of Intelligent Office – now called Intelliflo Office (IO) – to its network of around 1,300 investment and mortgage advisers.
Following the launch of the new system in September 2019, Tenet struggled with issues which have continued over the past two and a half years.
A spokesperson for Tenet told Money Marketing the network is seeing “excellent levels” of customer usage with the IO system.
Over a third of its members are making use of value-added components such as the personal finance portal to communicate securely with their clients, they added.
And others are using integrations with sourcing systems and call recording capabilities within IO.
Last year, the company said it had invested in its own in-house technology – Tenet Tech – to the tune of around £1.5m, which included a CRM refit powered by Zoho.
The network also established a technology support team to “enhance member services, improve efficiencies and prepare for future growth”.
The firm has hired 67 full-time employees across the business in the past 12 months, including Julie Woolmer, who joined Tenet from Quilter as compliance operations director, and Warren Vickers as managing director of Tenet Compliance Services.
Some adviser members, though, have been unhappy with the transition and have left, with more threatening to do so.
The financial services register shows that, between 1 October 2019 and 19 January 2022, 139 ARs have left Tenet Lime and 24 have joined.
Meanwhile, 71 have left Tenet Connect and 35 have joined, and 26 have left Tenet Connect Services, while 0 have joined.
This means overall 236 have left the group, and just 59 have joined.
This results in a net loss of 178 firms over 25 months, averaging out at 7.1 firms per month that have left Tenet.
In comparison, the previous 24 months (1 September 2017 to 30 September 2019), there were 88 joiners and 89 leavers.
This represents a net loss of one over 24 months – a significantly smaller average decrease of 0.04 firms per month.
Inside Tenet’s tumultuous 2020
One anonymous poster on a private adviser forum wrote, on 6 December: “How can a relentless exodus of members not change anything?
“Fewer members means less turnover, less profit and less fixed charges (which Tenet can keep ratcheting up only for so long), which are the lifeblood of any network.
“As revenues dwindle, overheads have to be cut (there’s already been one significant round of redundancies plus an unknown number of others and voluntary resignations not officially announced) which, in turn, means declining standards of service and support.”
They suggested that most of the new firms which are joining are fledgling start-ups which may or may not become successful and thus worth having.
“It’s a downward spiral,” they added.
The Tenet spokesperson said: “In line with changes across the wider sector, Tenet continues to prioritise productive advisers, that produce good customer outcomes and embrace the efficiency gains that technology can bring to their customers and regulatory requirements.
“These ongoing changes, combined with retirement and some members seeking direct authorisation have led to a slightly higher attrition rate, but presently our new business pipeline remains strong.”
An industry source, who wished to remain anonymous, told Money Marketing: “There is certainly a view in some quarters that Tenet members looking for help are better off using the Intelliflo support resources rather than the Tenet helpline.
“Some people have suggested that Tenet have underinvested in their internal support capability.
“There is also a view that the best way to get a quick response from Intelliflo is to use are their online help services.”
Another source, however, told Money Marketing that IO does not take enquiries. If a Tenet member goes to IO with an enquiry, the company refers it straight to Tenet.
In August last year, life insurance broker Protect Line walked away from the Tenet network to become directly authorised.
The exit sparked concern among some advisers about Tenet’s position. But Tenet has insisted it has “ambitious growth plans”.
A day later, the group bought Yorkshire-based wealth management company Astute Financial Advisers, as part of plans to expand its advice arm Tenet&You.
And, in the same month, it announced it had appointed Martin Tyler as its new chief financial officer, to aid its expansion plans. By Lois Vallely 19th January 2022 3:27 pm