Daniel Hurdley: Three steps to a robust DFM due diligence process

The increased use of DFMs by financial advisers to manage their clients' investments has received significant coverage in recent years. Outsourcing is not, however, a responsibility-free option for advisers and the onus is on them to take appropriate steps to review and rate the DFM's capabilities and suitability. From a purely regulatory perspective there is an obligation on the adviser to review the market (Principle 9) and establish the suitability of the offering for clients (COBS 9.2). At all times, the focus of the exercise should be on achieving the best outcome for consumers. ...