In the end, the demise of Dover Financial Advisers mirrored its founder’s appearance at the royal commission in March: a short period of intense scrutiny followed by a quick collapse.
Advisers operating under the Dover license were told by CEO Mr Terry McMaster, in an email after lunch on a Friday afternoon, their authorisation to give advice under the Dover licence had been revoked with immediate effect. Mr McMaster told them they could give no advice to new clients nor new advice to existing clients from June 8 on (although they can still implement advice provided instructions were received prior to that date), and the Dover licence will be cancelled on or before July 6.
It’s unlikely that all 400-odd Dover authorised representatives will be taken on by other licensees before July 6, which raises significant issues for clients who find themselves in advice limbo as we approach the end of the financial year.
But the financial services industry is economically efficient, what is good about Dover will remain, what is bad will be discarded and the industry is acting on this already. But no one seems to be talking about the clients.
Dover was established with one clear goal and create one clear value: to improve the economic wellbeing of the clients of Dover’s advisers. That’s it, there is no other reason for the business to exist. This means the asset of greatest value in all of this is the wellbeing of the clients of Dover’s advisers and no matter what solutions emerge and what offers are put to Dover’s advisers, their clients’ interests must remain paramount.
Demonstrating a client-first ethos is what the industry would do if it were a profession and at a time of greatest scrutiny we seem to be silent on the needs of the customer. Dover didn’t mention it once in its email to advisers and the regulator and the industry body are both silent on this matter.
This is how a profession behaves; as the end of Dover accelerates we should be coming together as an industry to ensure no client can be disadvantaged and no client can be taken advantage of.
Mr McMaster’s email should have spelled out what Dover’s demise means for clients, and what its advisers should do to mitigate the impact.
It should have provided advisers with guidelines on how to communicate to clients, and what to do next. Instead, Dover’s advisers have been left to their own devices, to find a way through the current mess that prioritises the interests of their clients and also gives their businesses the best chance of surviving.