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Caution

WARNING

Do not accept any claims made by Financial Advisers who advertise in the English printed Spanish Newspapers, unless you check out the statements with the CNMV

If a company is passported by the UK Financial Service, it means nothing. A Passported Company must be registered with the Spanish Regulator.

We will be happy top check this out for you.

CONTACT:

Gwilym Rhys-Jones
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Tel: +(34 951 31 82 77
 Mobile: +(34) 699 840 606
 Skype address: gwilymrj

Or CNMV Isabbel Vicente

AUTOCONTROL

Asociación para la Autorregulación de la Comunicación Comercial
Conde de Peñalver, 52 - 1° D
28006 - Madrid
Tel.: 913 096 637
Fax: 914 029 824

Nacional del Mercado De Valores (CNMV). 

Most IFA's have no qualificationsin Spain,  and have no indemnity, and sell to companies where they get the highest commission.

Any Advisor that claims qualifications, indemnity and being regulated should state this in writing. We strongly recommed you check this out with the CNMV

The Direcion De Seguros ( DGS) is a licence for selling Insurance Products.

Where offshore Product Providers are quoted as being regulated, keep in mind this does NOT PROTECT YOU.

If you complain to  Product Provider about your IFA Miss selling  you will be referred back to your Financial Advisor as your Agent.

BE WARNED.

Check Here

SUR in English  ( See Sensible Options Tab)

Euro Weekly

Costa Del Sol News

Costa Bravo News

Onda Cero Radio

Global Radio

Spectrum Radio

or any other Spanish English printed newspaper or magazine

Keep in mind that the Consumer Office in Spain are not monitoring claims that are made in the English Press printed in Spain.

We have reported this matter to  the Financial Services who are looking into this.

You can report any advertising infringement to:-

Isabbel Vicente

AUTOCONTROL

Asociación para la Autorregulación de la Comunicación Comercial
Conde de Peñalver, 52 - 1° D
28006 - Madrid
Tel.: 913 096 637
Fax: 914 029 824

Before investing capital or parting with your hard earned money.

Check that the Financial Advisor or Company are regulated by the Mercado de Valores (CNMV)

Financial Advisors must all be registered and regulated before being allowed to operate as

a Financial Adviser in Spain.

The Financial Services World Authorities have issued ‘Principles for Business' for Financial

 Adviser's in the EU . The five relevant when referring to mis-selling are:

•  A firm must conduct its business with integrity

•  A firm must conduct its business with due skill, care and diligence.

•  A firm must pay due regard to interests of its customers and treat them fairly.

•  A firm must pay due regard to the information needs of its customers, and communicate

information to them in a way which is clear, fair and not misleading.

•  A firm must take reasonable care to ensure the suitability of its advice and discretionary

decisions for any customer who is entitled to rely upon its judgement.

It is of paramount importance to every future private investor here in Spain (and elsewhere) to check that their prospective financial advisory company here on the coast would satisfy these conditions before parting with any money. It is essential to carry out exhaustive checks to satisfy every investor that the company you are going to entrust withyour funds has full professional indemnity cover so that investors have recourse to full financial insurance protection in the event of the adviser's negligence and a successful claim. It is also important to determine, in advance, precise details of the complaints procedure where a disagreement arises and what opportunity exists for independent arbitration in the event that a dispute is contested. Background checks on the full extent of the advisory Firm are also a pre requisite. The Firm should be able to indicate it's long-term compliance record in all areas of its business activities whether in Spain or elsewhere.

NB: The Spanish regulators CNMV have a web site and telephone number available for people to check to see if a particular company is registered with them to be able to offer financial advice or services;

Click here to see it   

Tel. (00 34) 91 585 1500. Fax; 91 319 3373

Summary:
The ever-increasing complexity of juggling financial resources has led many people to avail themselves of the services of a Financial Advisors or Planners.  There are no rules governing the financial planning business. Anyone can hang out a shingle and bill themselves as a financial advisor. Certain basic precautions must be taken to avoid financial mismanagement.

More Information
 There is virtually nothing on the books to prevent anyone from bad advice. People can pick the wrong 'financial advisor' and watch their life savings disappear.

Be concerned because unregulated financial advisors hold themselves out as having some expertise in the financial area but may not. In most countries if there is a complaint and the commission investigates and finds that someone has breached the Securities Act, they prosecute. The other provinces are watching to see if the Saskatchewan model becomes law.

 What do you do ?

  • Feel comfortable to ask questions. Don't feel embarrassed that you don't know everything. The only stupid question is the one you don't ask when you don't have the answer.
  • Remember that the money you are dealing with is your money. If the money is gone you, not the financial advisor, suffers the consequences.
  • Watch out for unrealistic promises. If someone tells you they can double your money in a year, be careful.
  • Ask for the risks to be fully explained. Don't let the financial advisor steer you away from your own financial goal of protecting your money.
  • Don't make snap decisions.
  • Ask your financial advisor if he/she is bonded. Ask if they carry liability insurance to protect money if something goes wrong.
  • Expect a financial check-up. Investment is just part of the picture. Look for a statement of net worth; after all the bills are paid, what's left? Cash flow; how did the money come and go? Are there ideas to reduce taxes, a will and a contingency plan if you become disabled or your partner dies?
  • _______________________________________________________________________________

Many readers will be aware of the legal action currently before the Spanish Courts, initiated by the Costa del Sol Action Group, seeking compensation for alleged mis-selling of financial products.  The action group is targeting both the financial advisers who sold them the products and product providers (including UK firms) for allowing unregulated brokers to sell unauthorised products.  A High Court judge in Madrid has ordered a full investigation.  

 

This action is yet to be concluded, but the fact that this action has been taken should serve as a timely warning to all potential investors.   Before investing your capital you must take all necessary steps to protect yourself from becoming the victim of inappropriate advice.  It has always been important to ensure that the advice you receive is in accordance with your key objectives and at a level of risk that you understand and can accept.

 

If you do not understand what you are investing in, you may find that your capital is lost without much chance of recovery.   Regulation in Spain is not as comprehensive as the regulatory regime that exists in the UK and with which many expatriates are familiar.   The most important issue is to investigate the adviser you intend to use and only proceed when you have carried out exhaustive checks on them and the manner in which they transact business.

 

Having trust in your adviser is essential if you are to invest with confidence and have peace of mind.  Education, formal professional qualification and regulation may help your adviser to provide appropriate advice.  They may also help prevent fraud.  However, they are no more than an uncertain “insurance policy” that may provide compensation in the event of fraud or negligent advice.

 

The following checklist will help you establish trust in your adviser; ensure that you receive appropriate advice and avoid fraud:

 

·                    Ask you adviser for evidence of the following:

(i)                 How long has your adviser been providing investment advice to expatriates?

(ii)                Is your adviser permanently located in your area - or is he or she simply someone who spends some time in your area looking for business and then returns to their home base?   If you need continuing advice or have a problem there’s no point in your adviser being based thousands of miles away.

(iii)              Is your adviser a one-man band (or two/three partner firm) or preferably, part of a larger business?

(iv)              Can your adviser provide a wide range of international tax and trust advice?  It’s one thing making money but ensuring your affairs are optimised from a taxation point of view is also very important.

 

·                    Make sure your selected adviser listens carefully to your needs and aspirations and provides you with comprehensively detailed recommendations in writing, including charges, terms of business and risk warnings, before you consider proceeding.  Ask whether the report will be checked independently for compliance purposes, i.e. that the recommended investments are in accordance with your stated objectives and risk tolerance.

 

·                    If your adviser promises returns that sound too good to be true, they probably are! Ask your adviser to give you a “risk analysis” of their recommendations.  There is nothing fundamentally wrong with most high-risk investments, but they often come camouflaged with persuasive marketing hype that makes them seem less risky than they are.

 

·                    Ask for written evidence that the products offered are fully regulated, and authorised for distribution, in Spain or you may find that you have more tax to pay than is necessary.

 

·                    Establish that you will be sent regular valuations, prepared independently of the adviser, and that you will be able to obtain this information at any time you need it.

 

·                    Find out what the adviser’s complaints procedures are.   Ideally complaints should be dealt with independently of the adviser, either by a senior executive of the firm or by an arbitrator independent of the firm.

 

·                    Ask for evidence that Professional Indemnity Insurance adequately covers your adviser.  This means that if your adviser is negligent in the advice he provides to you and you decide to take action there is a substantial insurance company or insurance syndicate underwriting any damages you are awarded.   You should not be dependent upon the solvency of your adviser for compensation in respect of negligent advice.

 

·                    Never hand your cheque or make a payment for any investments direct to the adviser.  Always make the cheque/transfer payable to the investment institution he has recommended and preferably send it direct to them.

 

·                    Try to get a reference on the adviser from someone in your local community - if they have had a good experience with him/her over a lengthy period it will give you more confidence.  Don’t expect your adviser to give you client names for reference purposes though - he’s bound to observe the requirement of confidentiality expected by all clients.

 

Most advisers operating offshore are diligent and honest.  However in the event of fraud or bad advice there is a major problem for UK expatriates.  If you receive advice from a non-UK base and if you are a non-UK resident, even if the adviser is regulated in the UK, you will not be able to benefit from all of the regulatory benefits provided by the UK regulator (the Financial Services Authority).  In such cases, for example, you won’t be able to claim compensation under the Investors Compensation Scheme or even take your case to the FSA Ombudsman. There are many substantial areas of UK regulation that do not apply to UK expatriate investors in these circumstances.

 

If your offshore adviser is part of a large UK financial services group or bank then it is likely that the group’s reputation and its financial resources will be your greatest comfort. (As an example, my own firm, Blevins Franks International Limited, whilst not regulated in the UK, is part of a substantial UK financial services group, of which all of the UK companies are fully regulated). 

 

Most such firms have internal Compliance Officers and procedures designed to consider all complaints and make recommendations to resolve any problems, often including compensation, without the need for you to resort to the long-winded bureaucracy of dealing with the regulatory authorities. 

 

All of the above will help you to avoid fraud and also ensure the advice you are given is appropriate to your circumstances.  However as with all-important things in life, you eventually must place your trust in someone - your chosen financial adviser’s services will only produce the best results if you work in a form of “partnership” with him.  This will be a lot easier once you are satisfied that your adviser comes through the above tests with flying colours.  If he doesn’t, look elsewhere.

 

Education, qualification and regulation are very important but nothing like as important as cold hard facts with which you are satisfied before you hand over your money.

 

It’s better to test the lock on the stable door in advance of parting with your money!

 

 

 

© COSTA DEL SOL ACTION GROUP
Against Unlicenced Financial Advisers & Product Providers that support them.