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INTERVIEW: New Firm Fidusys Wants To Raise The Bar In How Trustees Do Their Job
Tom Burroughes
8 October 2012
A trustee can only be as effective as the quality of the information and
communications channels that are available but in far too many instances the
industry falls short, argues the creator of a new business for the sector. One problem is that the roles of trustees and trust administrators are
blurred, despite the very different roles they play, says Robert Clifford, who
recently told WealthBriefing about
his business, Fidusys, which is based in Jersey.
The firm, launched a few weeks ago, is described as a “purpose-built online
management system for fiduciaries”. “I would like a really good debate in the trust industry about what is
best for settlors and beneficiaries about how best trusts can be managed. Trust
systems need to support trusteeship, good decisions, as well as they support
administration. Decisions come first, administration follows,” Clifford said. Fidusys offers online services such as what it calls “trustee/director
decision management”; trust management, including any risk rating or associated
methodology; a management overview portal; document management; know-your-client
compliance support, and automated filings of meetings. Clifford reckons his business will put more information in front of
trustees and in an efficient manner – something that the trusts sector will
appreciate at a time when costs of doing business face upward pressure as
compliance burdens mount. Distinctions The trustee/administrator function split is a key part of his firm’s approach. “In assessing trust company performance the onset of litigation often
reveals a schizophrenic approach by settlors and trustees alike,” Clifford
said. “Before any litigation, the most usual indicators of trustee performance
are cost and administrative efficiency. When and if litigation commences there
is a sudden sea change in opinion and, unsurprisingly, everything turns on the
quality of trustee decisions. It is not a question of fault, but a question of
focus, priorities and communication. Decisions, or trust management, need to
emerge from the shadows of efficient administration and inadequate information
management systems,” he said. Trustees are decision makers and trust administrators as those who carry
out the requirements of trustees. There are clear differences between their
roles and the type of support that both groups need, he said. “I wanted to create a system but did not want to work in the same way as before. I therefore
decided to build a system to help trustees fulfil their functions better than
they do at the moment.” The business model of Fidusys can be expanded sharply – it is “very
scalable”, he said. As far as the business’s impact on the trusts sector is concerned, transparency
seems to be a key word. It enables trustees to see what all the different issues
and risks are for a trust as part of a single package. It will also help
banks understand trusts better, he said. The system can support any type of
entity, including foundations, as it is configured by the trustee.