On the 15th January Hargreaves Lansdown (HL) announced new charges on its investment platform, which is one of the most widely used by private investors. The changes are no doubt provoked by the new rules whereby funds can no longer pass part of their charges back to HL, as a result of the RDR (Retail Distribution Review). But the changes will mean that the annual fees paid to HL by some investors will double. ShareSoc has issued a press release explaining the impact of the change
A particularly dubious change is the imposition of a fee of £10 if you wish to exercise your vote as a shareholder, or wish to attend an AGM which is very damaging to shareholder democracy and good corporate governance. Instead of making it easier for investors to exercise their rights, as other investment platforms have done by providing automated systems, they seem to have chosen to deter investors from taking any interest in the companies they own.
In addition the changes prejudice those investors who prefer to invest in a mix of direct shares and investment trusts rather than funds when investment trusts have been shown to generally be better value in terms of performance and charges than funds. Hargreaves Lansdown seem to be taking the side of the fund management industry as against the interest of their clients.
Anybody affected by this change is recommended to contact HL to object to these changes, and if they do not reconsider their position to look to transfer to other investment platforms.