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Old 05.04.2012, 23:37
Starshollow Starshollow is offline
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Re: Financial Mis-selling to expats

This maybe a bit uncommon - but I guess the fight against "the company who must not be named" and other similarily bad financial salesperson (I will not call them advisors as they are not even close to being one) unites us even over the boarders.

I am something of a "regular" on the finance forum of Toytown Germany for some years. About 3000 contributions to my name and I think I am safe to say that I have gathered the reputation to be a fair, unbiased financial advisor to Expats clients in Germany. Since you guys here are not even remotely in my "focus group" of clients (as I have neither a license nor any interest to offer our services to Swiss clients), I hope my words about the typical "offshore perps" can be taken with the proverbial grain of salt...

I have read numerous contris here, specially from this SWAN-something guy who first sold in CH and then vanished to a farm in Spain.
From a German perspective (and not knowing the CH laws - but I am sure somebody can come up with them), here are my comments on what the "company who must not be named" does in Germany:
1. Cold-Calling: first of all, as others have pointed out, it is stupid and bad style if you do it anywhere. There is no good exuce for it. If you as a good financial advisor do not get enough new clients from advertising (which costs more money than cold-calling, oh dear) and references from existing real clients, you are doing something seriously wrong and people should stay away from you just for that reason.
There is no good excuse for cold-calling B2C in finance. Period
And in Germany it is utterly and entirel illegal. If you call someone in Germany EVEN IF YOU HAVE RECEIVED A REFERENCE without his/her explicit permission, you are breaking the law. Again: Period - no room for discussion. But usually you guys do not even have a "reference"....

Don't know the CH laws, but since they are the same in Austria like in Germany, I would be surprised if they were much different in CH, too.
In Germany it is clearly illegal and they still do it - and they know it is illegal, btw.
If somebody breakes the laws just to get in contact with you, question is, what other laws is he/she willing to break to get your money?

2. Offshore pension plans: at least in Germany they are "selling" these pension plans illegally. Appart from the fact that some of these plans are for good reasons banned by the FAS in the UK for UK clients (General Vision, for instance), under German laws you need a specific license to offer these plans which this company does not have. And you have to disclose the costs for the plans in full EUR before anybody signs -which they also never do. And there are a number of other customer protection laws they break when signing up people for those plans. Thus, many people have lost serious money there and this is not a myth - I have the files and we are fighting to get their money back.

3. QROPS investments and autocallable notes
"The company that must not be named" claims to have catered to about 1/3 of the volumn of British pension capital going out of country through QROPS...without proof.
Some of the schemes are pretty questionable, legally speaking.
they all come with high frontloaded costs. If these costs are fully disclosed and someone sign up still, I have no qualms - but I have not seen ONE case where the costs where disclosed in full EUR as required under German laws. Hence they are not folloing legal requirements in Germany
"The company that must not be named" is selling left and right derivatives in Germany - "autocallable notes" from RBS and other providers. Appart from the fact that these are, -legally speaking - bets in the form of bonds and as such quite questionable as investment tools if you look at them closely with regards to the total risk involved, it requires in Germany a special license by the federal authorities to offer and advise on these derivative products. "The company that must not be name" has no such license. Nor is it allowed under any EU rules to offer these products in Germany the way they do. Wonder if they are allowed in CH after all, anyone checked yet?

I can't judge what they do in CH. But the German outfit is clearly boardering on organized crime. If you are ready to violate even the poor consumer protection standards as they are in Germany, people should stay miles upwind from you.

And once again: cold-calling is for perps and jerks...if you are a serious and good independent financial advisor, you do not need to fall so low...

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