Are you getting the best deal from your investment manager?

YOU just signed on the dotted line to purchase a dream home. And your spouse relates to the property sales agent that the plan is to have a Bali-themed concept renovation. The property agent whips out a business card to recommend a renovator.

Most clients will have questions at the back of their mind: Is the recommended renovator a dependable and trustworthy company? Did the agent recommend the renovator as there is a side arrangement between him or her and the renovator? These questions arise as there is potential conflict in interest which is not uncommon in many sectors, including the financial services sector.

In the above hypothetical scenario, the buyers' interest is securing the best renovator, which could be down to several criteria such as track record, price of quotation, execution and warranty. This can differ from the property agent's interest should there be a referral fee involved. The agent may be out to secure an additional income stream and therefore securing referral fees is definitely on the table. As the interests of the buyer and the agent differ, the outcome may not be optimal for the buyer.