Although a number of the largest do-it-yourself (DIY) investment platforms scrapped exit fees last year following criticism from the financial regulator, a number of these and traditional brokerage firms still charge you when you move your money away from them. A recent example of this was when a franchise agreement ended between broker Redmayne Bentley and its branch in Beverley, run by Robert Hughes, who had been operating in partnership with the firm since 1992. Redmayne Bentley issued notice to Mr Hughes in spring 2019 and the contract was terminated in April this year. But if clients of Mr Hughes want to move with him to the new broker he has chosen to partner with they will have to pay Redmayne Bentley’s standard exit fees.
Mr Hughes says that he and his clients were not aware that Redmayne Bentley's exit fees would be applicable to them. However, Redmayne Bentley has a contract with every client and transfer fees are a part of every client agreement, as set out in its terms and conditions, which have been communicated with clients on a number of occasions. Clients who want to leave pay £15 per line of stock up to a cap of £195 per account. The fee is £60 more expensive for clients with individual savings accounts (Isas), although these fees are lower than the transfer fees charged by a number of other comparable brokers.
Ron Needham, a client of Mr Hughes and Redmayne Bentley, said that it was a “big shock” when he discovered that it would cost him almost £750 to move his money from Redmayne Bentley. He wants to do this because he has been a client of Mr Hughes at the Beverley branch for nearly 30 years. Mr Needham and his wife have Isas, and he also has a general investment account (GIA) to transfer.