Private equity firms have increasingly consolidated independent financial advisers (IFAs) into larger umbrella brands, raising concerns about the potential impact on clients’ savings and the incentives driving these transactions. Since early 2023, the number of financial advisers working at private equity-backed firms has risen sharply, from 4,157 to 7,706 as of March 2026, with assets under management nearly doubling from £210 billion to £484 billion, according to industry analysis.

This dealmaking trend echoes consolidation patterns seen in sectors such as veterinary practices, dentistry, and childcare, where private capital seeks growth through roll-ups. While the consolidation can bring benefits such as pooled resources, stronger governance, and enhanced financial resilience, advisers and regulators are increasingly wary about the consequences of these transactions for clients.

A prominent case highlighting concerns involved True Potential, a wealth management group backed by the London private equity firm Cinven. True Potential offered advisers commissions of up to 8% on client assets transferred onto its own investment platform — equating to up to £40,000 for shifting a £500,000 pension pot. Following exposure of these incentives, the Financial Conduct Authority (FCA) launched an investigation and required the firm to implement a redress scheme for affected clients. Steve Hutton, then CEO of True Potential’s wealth management division, acknowledged shortcomings in communicating transfers to clients and announced changes to improve disclosures and adviser onboarding.

Several IFAs expressed apprehension about how private equity ownership can influence adviser behavior and client outcomes. Nouran Moustafa of Roxton Wealth said that frequent approaches by private equity firms to acquire advisers often lead to existing client portfolios being moved into the new owners’ funds. She argued that this process can increase charges and diminish the personalized service traditionally offered by independent advisers, reducing clients to “cash machines” and advisers to sales agents.

Paul Denley, CEO of Oakham Wealth Management, cautioned against models reliant on transferring clients into in-house products or standardised portfolios, particularly if it reduces personal contact in favor of online-only servicing. He acknowledged that conflicts of interest are not unique to private equity but warned that short investment horizons and leverage typical of private capital could intensify pressures to extract value, potentially to the detriment of clients.

James Rainbow, CEO of St James’s Place Wealth Management, highlighted the inherent conflict arising when private equity buyers offer attractive deals contingent on moving client assets to proprietary funds. Rainbow stressed that making such moves beneficial to clients requires careful consideration of tax implications, costs, product quality, and fees.

The FCA’s review of the adviser consolidation market noted that while roll-ups can enhance efficiency and foster sustainable growth, it had identified instances where firms offered explicit or implicit incentives encouraging advisers to invest client funds into group products. The regulator observed that conflict management approaches varied significantly and that some were inadequately developed.

Safeguards remain in place to protect savers. Advisers must engage with clients about any transfer to new investment platforms and ensure recommendations meet suitability standards, including compliance with the FCA’s consumer duty to avoid foreseeable harm. Furthermore, advisers can face legal and regulatory consequences if clients suffer damages due to imprudent advice or unsuitable product changes.

As private equity continues to shape the financial advice landscape, industry participants emphasize the importance of maintaining independent investment decisions and prioritizing clients’ interests to uphold trust built over long-term adviser-client relationships.