Referral networks: why the client always pays for them

Between a programme and an applicant sit several layers of intermediary, and each takes a share of the same fee. The chain explains both the price and, more importantly, the quality of the advice.

The chain

• The government unit that runs the programme and sets the fees.
• The authorised agent, licensed to file, who receives a commission from the programme and charges the client.
• Sub-agents and promoters, who introduce clients to the agent and take a share of the commission.
• Referrers — wealth managers, lawyers, property brokers, tax advisers — who introduce clients to the promoter and take a share of that share.

Four layers, one fee. The client pays for all of it, and the advice they receive comes from the layer with the least information and the most direct commercial interest.

Why it distorts advice

• Commission differs between programmes. A referrer with an interest in one route will present it as the answer, and the honest comparison is not something they are paid to produce.
• Nobody in the chain is paid for saying no. The correct advice for many enquirers is that they already qualify by descent, or that they do not need a programme at all. That advice earns nothing.
• The person you speak to is furthest from the file. Questions about the actual legal position are answered by relay, and the relay loses accuracy.

What to do about it

• Ask directly: are you receiving a commission on this, and from whom? A professional answers; the answer being yes is not disqualifying, but a refusal to answer is.
• Go one layer up. Deal with the licensed agent rather than the promoter, and check on the published list which is which.
• Pay separately for independent advice. A lawyer or tax adviser paid by you, with no interest in which route is chosen, costs a fraction of the commission embedded in the fee and is the only advice in the chain that is aligned with you.
• Compare the total, not the professional fee. Government fees are published and identical for everybody; the difference between quotes is the chain.