Anti-referral fee conveyancer does U-turn
Conveyancing firm, The Partnership, is to start offering agents £100 in referral fees, despite director Peter Ambrose previously describing the practice as ‘tantamount to bribery.’
Source: Istock
Ambrose launched a vitriolic attack on referral fees in 2009 in response to a Channel 4 investigation into commission payment made in relation to Home Information Packs.
Agents who refer three leads to The Partnership will, irrespective of whether or not they convert into business, receive £100 in gift vouchers for a range of retail stores.
Ambrose says: “That [the fee attack] was last year; the market’s changed.”
He adds: “Several years ago, I was concerned that Home Information Packs suppliers were paying introductory fees that in our opinion affected the impartiality of recommendations, as this was a commoditised product that did not impact the outcome of the sale of a property and therefore the agent’s commission.
“However, conveyancing is completely different; our surveys indicate that on average, agents suggest four lawyers to their clients for them to make their own choice and never recommend a firm directly. They only suggest firms they know will ensure a successful transaction.
“The law concerning bribery is very clear - the person must be induced to perform improperly and not to act impartially, with agents providing a list of potential suppliers and the client making their own decision. This is simply not the case.
“Our marketing scheme is radically different than referral fees, as it is the standard practice of buying leads that enable us to compete for the business, which means offering competitive fees so the client is not disadvantaged in any way.”
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Readers' comments (3)
qkillip | 24/08/2011 7:22 am
Hmm... "tantamount to bribery". Mr Ambrose's offering is surely financial inducement that affects the impartiality of an estate agent; falling squarely within the definition contained in the new Bribery Act... and therefore IS bribery?
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Integra | 25/08/2011 11:28 am
Having read this article, I would suggest that Mr Ambrose remains firmly behind the times.
Well over 65% of conveyancing is "introduced" and agents rarely or never provide 4 law firm names - they may have a panel of 4+ law firms but usually operating to identical fee scales and service levels etc.
£100 of gift vouchers for 3 leads is not going to win the hearts and minds of agents either when many are obtaining £200-300 per completed transaction.
This "news" has gained some publicity but the business model may have been better served by sticking to a no payment policy and working on service and delivery of results. Now that would be a differentiator!
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Peter Ambrose | 25/08/2011 12:08 pm
I totally agree that service and delivery of results are key and indeed, that is, and always has been the basis of our business.
Sadly, today,for many clients that isn't seen as a differentiator.
That is in the main because conveyancing, which is often complex and extremely challenging, has been debased by client's expectations and very low fees. If a firm is willing to transact a property for a couple of weeks' worth of supermarket shopping, no wonder people put little value on the process.
Law firms are faced with very similar challenges to estate agents, and it takes very hard work, innovative ideas such as ours and a commitment to 7 day per week availability that seems to make the difference.
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