JO Hambro Capital Management (JOHCM) is under investigation by the Financial Conduct Authority (FCA) for about AUS$8.6m of services paid for out of dealing commissions over the course of a decade.
The FCA is showing strong support for the European Securities and Markets Authoritys (ESMA) stance on dealing commission as it prepares its own line ahead of Mifid II, coming in from 3 January 2017.
According to Rob Boardman, the FCAs recent recommendation to unbundle the payment of research from dealing commissions could be a boon for independent dealers and research houses.
According to the FCA, the bundled supply of execution and research services by brokers makes price discovery difficult.
Under new rules announced by the FCA, investment managers will only be able to pay for substantive research with dealing commissions.
