Morgan defends fees for Vestar clients
Gareth Morgan Investments has been promoting a no-fees service to manage frozen investments for ex-Vestar clients – but a $2000 set-up fee still applies.
The $2000 is the company’s normal set up fee for new clients with a portfolio of under $500,000, including existing stock assets.
An initial portfolio assessment for potential clients is free.
A commenter on website ‘Victims of Vestar’ noted that they had consulted Gareth Morgan Investments but were “feeling a little sensitive at the moment to ‘fees’ from our battered retirement fund and feel $2k is over the top for the service actually offered.”
Gareth Morgan Investments general manager Rob Taylor confirmed that the set up fee would apply to new ex-Vestar clients no matter how large the frozen section of their portfolio.
“We can’t discount fees because it’s unfair on other clients,” he said. “It takes time to bring the assets into our portfolio and invest them into the markets.”
Normal fees also applied to the sections of Vestar portfolios that were not frozen – for example, in receivership like Bridgecorp or Capital + Merchant.
Mr Taylor said the fees had been transparently disclosed while other advisers trying to attract Vestar clients with no set-up fees were taking trail commission or custodial fees.
“We’ve put the information out there,” he said. “It’s up to the Vestar clients to choose.”
He said the company was now winding down efforts to reel in ex-Vestar investment clients after signing up 12 so far.
Earlier this year Gould Wealth Management bought Vestar’s assets, wooing clients with an offer of an overall 0.1 percentage point discount on fees.