Rathbones changes onboarding after FCA skilled-person review

Rathbones is tightening client onboarding and changing fees after a Financial Conduct Authority skilled-person review found areas for improvement in the wealth manager’s Consumer Duty implementation and compliance oversight.

The FTSE 250 group said it will pause onboarding new clients requiring enhanced due diligence for up to 12 months. It will also stop taking new investment inflows into general investment accounts from some existing enhanced-due-diligence clients.

The review covered how the firm was meeting the FCA’s Consumer Duty rules, which are designed to ensure firms deliver good outcomes for retail customers. Rathbones said the findings related to its UK wealth management business, including compliance, oversight and assurance arrangements.

Operational impact

The affected new and existing higher-risk client segments accounted for roughly £900 million in gross flows in the past year, according to reporting cited from the company announcement.

Rathbones also said it will stop charging investment management fees on cash balances held within clients’ discretionary portfolios from July 1. The fee change is expected to reduce 2026 pre-tax profit by about £9 million.

Chief executive Jonathan Sorrell said the firm is committed to operating to the highest standards for clients.

What comes next

The company has not yet clarified the exact scope of the affected client categories or when the onboarding restriction may be lifted. Further attention will also fall on any FCA follow-up and on whether Rathbones can limit the longer-term hit to revenue and inflows.

Reporting from later in the day added that Rathbones expects the remediation programme to cost about £60 million over two years and that the pause could affect nearly £1 billion of new business, underlining the scale of the response.