Interesting complaint blog about TCTMNBN

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Interesting new blog coming over from Africa, where apparently also some DeVere salesmen ( also known as TheCompanyThatMustNotBeNamed :-) ) have missold pension plans and investment products where either the advisor was not properly licensed to do so or the products were not licensed to be offered in that country or both.

 

https://dupedbydevere.com/

 

An old story also for Germany, I am afraid. I have currently two clients alone with a prominent lawyer in Munich who is trying to get them their money back from illegally sold Generali Vision plans and also QROPS-plans that do not comply with German laws either (and can create terribly bad tax consequences for tax residents of Germany).  In these cases the sales took place at a time when DeVere Germany did not have the necessary license to offer advice on pension plans (in the form of pension insurances) and at least the GENERALI VISION is not allowed to be offered and sold in Germany.

 

If you are under the impression you have also been sold on an overly expensive pension plan by DeVere or other "Independent Financial Advisors" (there are a few outfits active in Germany, mostly all lacking the required licenses under German laws), you can send me a personal message and I'll hook you up with the lawyer Mattil in Munich who tries to collect a number of victims of such practice in order to sue the company for repayments.

 

You can certainly also support these brave guys in Africa by commenting on their Blog and thus give the topic a bit more prominence... :-)

Cheerio

 

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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and the plot thickens...as they say.

 

DeVere is finally under the close inspection by the British FCA...and as a result does not offer anymore currently advice on Overseas Pension transfers according to a new report on the "International Advisor": DeVere under inspection by the FCA

According to a statement on the FCA website, deVere UK was ordered to "immediately cease" providing third party companies with transfer value analysis (TVAS) reports or other similar reports of information "designed to assist third parties companies in transferring customers DB pensions to an alternative arrangement".

 

Agreement

 

The deVere spokesperson said the company had “entered into a voluntary requirement to cease providing advice in this arena” and is working “alongside the FCA’s appointed independent body through the section 166”.

 

The international advisory company was issued with a section 166 or ‘skilled person review’ by the Financial Conduct Authority (FCA) and said it “fully supports and welcomes the review”.   

 

Section 166 gives the UK regulator the power to obtain a view from a third party “about aspects of a regulated firm’s activities” if they are concerned or want further analysis.

 

 

Interesting times...

 

Cheerio

 

 

 

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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And now to the situation in Germany:

 

If you have been advised by DeVere Germany in recent years, please take notice of this:

 

- until early in 2013, DeVere Germany was not licensed to offer insurance advice in Germany (lacking the necessary registration and license under § 34 D GewO) . Pension plans like the Generali Vision but also other kinds of offshore pension plans come in the form of a life assurance and thus require the license for insurance advice.

The license for insurance advice was required since 2007 by law.

Initially DeVere claimed to operate in German under a sub-license from Belgium (even saying so on their own website and pamphlets). However, we were able to establish with the Belgium authorities that no such license for cross-border activities nor for freedom of establishment was granted to DeVere and therefore all insurance advice activities from DeVere were illegal. After our complaint, btw, DeVere als gave up their license in Belgium after the Belgium authorities looked closer into their activities

If you have been sold a Generali Vision plan or an Scandia/Old Mutual Executive Investment Bond or  STM Malta pension plan, before Spring 2013, you have a clear legal claim for illegal activities by DeVere and its advisors in Germany and can get your money back.

 

- ever since January 2013 a financial advisor who advises on investments has to have a license under § 34 F GewO in Germany. Until today DeVere Germany has not such license. if you have received investment advice ever since, it was without license and you have a claim for malpractice regardless of the outcome and get damage paid or your investments paid back to you.

 

 

The specialized lawyer Peter Mattil and his colleagues in Munich are already representing a few "victims" of DeVere Germany. If more people who have been sold either illegal products (like Generali Vision) or have been advised into bad/unsuitable investments as part of a QROPS transfer or investment advice  join together, chances are to go after DeVere for repayment of capital and interest big time.

You can contact me for information or contact Peter Mattil directly via his website: http://www.mattil.de/de/startseite.html

 

Cheerio

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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DeVere Group is adding a Munich office to meet what the company describes as a surge in demand following the Brexit vote

The office in the Bavarian capital joins deVere’s existing Frankfurt operation.

The Munich business will be headed by Glen Crossfill, area manager, who has moved from Dubai where he filled a similar role within the global financial advisory firm for seven years.

Crossfill will report to Nicholas Grams, country manager for deVere Germany.

The decision to open a second office in Germany was driven, in part, by rising demand in the last 18 months following Brexit.

Crossfill said: “We attribute much of this surge in demand to Brexit for two key reasons.

“First, it’s our experience that more and more expats, high net worth international investors, and German nationals who’ve been living overseas, are relocating to Munich, with many of them telling us this in in direct response to the UK’s decision to leave the EU.

“And second, many of these individuals are specifically seeking advice on certain specialist financial products, such as recognised overseas pension transfers, ahead of the official Brexit deadline of 29 March next year.”

He added: “Due to a forecast growing client base, we will be looking to recruit additional talented wealth advisers plus career-minded support staff in the coming months to join our existing team.

“We intend to have 10 financial consultants in place by the end of the third quarter, who will be assisted by their coordinators and administrative staff.”

James Green, divisional manager for deVere Group in Western Europe, said: “This expansion in Germany is part of our ambitious strategic plans for Western Europe.”

 

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On 05/04/2018, 16:20:49, fraufruit said:

So are they all licensed up now with i's dotted and t's crossed?

 

Hell no... ! 

 

I will see what the local authorities are doing this time. Currently the German company (a GmbH) has only a license for insurance broker. Which, while it does entitle them to offer pension insurance advice, too (which is a real pity), it does not allow them to offer investment advice.

What's more: the individual advisors, since they are not employed with a gross salary by TCTMNBN but rather work on commission base only, have to have their own insurance advice license. Which, of course, none of them have because they would not be considered qualified under German law anyway.

 

Cheerio

 

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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Hallo Starshollow,

 I have recently been approached by Glen Crossfill and his sidekick Yuvraj Singh from the deVere Munich office, with ideas to transfer my UK Pension entitlements to a lucrative tax-free offshore scheme - do you have any information or advice on this scheme?

Cheers

MW

 

 

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First of all: there are no "tax-free" offshore schemes available...just shows that those "advisors" at this and similar companies have not the faintest idea or professional knowledge about the taxation for residents in Germany. So forget about the entire schpiel they have given you to this regards.
 

Secondly: that particular company has recently settled a major legal issue with the SEC (regulatory authority) in the US while several of their main managers for the US are still facing court charges. The legal info - open to the public in the US - are an interesting read because there you can see how badly overcharged with commissions upfront as well as hidden as kickbacks from underlying "investments" these plans are. You would easily lose out 10-15 % just on commissions (that these salesmen get paid by) deducted from your capital with such a transfer. You can read about this yourself here:
https://www.reuters.com/article/us-sec-devere/sec-fines-new-york-firm-devere-8-million-over-uk-pension-advice-conflicts-idUSKCN1J02O2

https://www.pacermonitor.com/public/case/24701464/Securities_and_Exchange_Commission_v_Alderson_et_al

 

You can read the main complaint document here by downloading from Dropbox:
https://www.dropbox.com/s/o886wvpcj8fkzzm/USA%20-%20comp-pr2018-101.pdf?dl=0

 

Here are some interesting quotes if you do not want to go thru the entire document (which I would still recommend as very enlightening reading :-) )
 

Quote

Alderson, the former Chief Executive Officer ("CEO") of Commission-registered
investment adviser de Vere USA, Inc. ("DVU"), and Hamilton, a former DVU Area Manager,
defrauded hundreds of clients and prospective clients resident in the United States ("US") by
misleading them about the benefits of irreversibly transferring their United Kingdom ("UK")
pensions to an offshore pension plan while concealing serious conflicts of interest, including the
lucrative commissions
Alderson and Hamilton each stood to-and did-receive.

 
Quote


Though Alderson and Hamilton were investment advisers with a fiduciary duty to
provide full and fair disclosure of all material facts, they nonetheless provided advice that was
self-interested and designed to push clients and prospective clients toward a QROPS transfer,
which, when effected, generated for Defendants millions of dollars in undisclosed commissions.

 

 

 

Quote


4. First, Defendants concealed their significant financial motivation to consummate
a QROPS transfer. Upon transferring a client's UK pension assets to a QROPS, DVU's overseas
affiliate (the "Overseas Affiliate") received an immediate commission equivalent to 7% of the
pension transfer valu
~ from a third party firm (the "7% Upfront Commission"). The Overseas
Affiliate then paid the DVU IAR who recommended the QR OPS transfer half of this amount,
which, from June 2013 to March 2016, totaled approximately $2.6 million for Alderson and $2.1
million for Hamilton in undisclosed compensation.
5. Alderson and Hamilton knew that the 7% Upfront Commission constituted their
primary form of compensation and that it was undisclosed. Moreover, when clients and
prospective clients asked about fees or how Defendants were remunerated, Defendants
misleadingly referred to a 1 % advisory fee
, while purposely omitting mention of the 7% Upfront
Commission or their share thereof. Alderson also instructed other DVU IARs to make the same
misleading representations to clients and prospective clients. In addition, Defendants also failed
to disclose additional commissions that they received in connection with their clients' QROPS
investments and currency conversions.

6. Second, Alderson and Hamilton misleadingly touted QROPS as offering what
they called "open architecture," which they explained as giving clients investment flexibility
through access to over 15,000 securities. They also instructed and trained other DVU IARs to do
the same. In reality, however, Defendants were well aware that DVU IARs were only permitted
to recommend to clients, and allow clients to choose from, a limited number of investment
options that at most, was less than one hundred, not thousands.
7. Between June 2013 and at least the fall of 2014, DVU IARs were permitted to
recommend only a handful of European multi-asset funds and certain structured notes, all of
which paid front-end load fees (the "Front-End Fees") to the Overseas Affiliate
. The Overseas
Affiliate, in turn, split the fee with the DVU IAR who recommended that the client purchase the
European fund or structured note. Alderson and Hamilton each received more than $100,00,0 in
Front-End Fees that they misleadingly presented to clients as required "entry fees" without
disclosing their financial interest in such fees.
8. Third, Defendants misleadingly touted the tax benefits of a QROPS to investors
without informing them of tax risks
, including that a QROPS transfer could be a taxable event in
the US. Defendants told prospective clients that QROPS transfers were not taxable by the
Internal Revenue Service ("IRS") while omitting mention of IRS guidance, and views held by
several accounting and tax professionals, to the contrary. Defendants also falsely claimed that
alternatives to QROPS transfers-including leaving the pension in the UK or transferring it to a
self-invested account known as a Self-Invested Personal Pension ("SIPP")-would subject the
pension holder to certain tax consequences, such as double taxation by the US and UK, despite
knowing about a UK-US tax treaty that resulted in a contrary outcome
. Defendants instructed
and trained other DVU IARs to make similar misrepresentations and omissions to potential
clients regarding tax treatment.

 

 

Quote

Defendants and other DVU IARs recommended that the clients utilize certain
QROPS-related product and service providers from which the Overseas Affiliate, Defendants
and the other IARs received millions of dollars that were not disclosed to their clients and
prospective clients. These recommended product and service providers included Malta-based
QROPS trustees (the "Trustee Firms") and an investment-linked policy issued by offshore
insurance companies that served as custodial accounts for the QROPS investments (the
"Custodian Firms").

1

 

And, trust me from long watching and talking with Germany-based clients of that company: this is not a singular error limited to the US branch....

 

You can ask those "advisors", if you like:

a) about how they themselves are qualified under German regulation to offer insurance advice (it is about pension insurance after all and DeVere Germany GmbH only has a license as an insurance broker and not as a financial advisor) and if they have proof by the local Munich IHK that their qualifications are sufficient to give advice in Germany ---which they have to apply for under German laws

b ) furthermore you can ask them to write out the actual and full costs of the commissions charged upfront and later from investment in full EURO in their quotes for you...again, this is something required under German law, just stating some vague percentage is not sufficient here in Germany

c ) last but not least you should ask them for written proof about the "tax advantages" they are claiming for those offshore plans from a respected large tax advisor company (like Deloitte or KMPG or Ernst&Young for instance) because these offshore pension plans are most likely underlying transparent (i.e. yearly reporting of profits and losses in your tax declaration) taxation here in Germany for you as a German resident.

d ) and finally, since they are registered/licensed as an insurance broker here in Germany which requires them to act in a fiduciary role towards you as an advisor, ask them about the Germany-based QROPS-compliant pension plans - like, for instance, from ALTE LEIPZIGER insurance company - and why they are not offering those to you as an alternative, too?

 

After you have asked these questions and read the above, I am sure you have all you need to make an educated decision whether you want to entrust them with your hard-earned pension capital or not.

For legal reasons I can't and won't tell you what to do myself :-)

 

Cheerio

 

 

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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I also received a call out of the blue back in June from a well-spoken  advisor of this company back in June on my mobile phone number. I am guessing they harvest data from linked-in profiles. I asked him send me what he wanted to say by email and that I would call him if I found it interesting enough. When he tried to organize a follow up call, I told him politely but firmly not to call me ever again, unless I call him first.

 

It's the "cold-call" which irritated me the most but to be fair that was the end of the matter.

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26 minutes ago, akguni said:

It's the "cold-call" which irritated me the most but to be fair that was the end of the matter.

 

Cold-calling of consumers is illegal in Germany. It's only one of the many shady business practices that TCTMNBN pursues.

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3 minutes ago, El Jeffo said:

 

Cold-calling of consumers is illegal in Germany. It's only one of the shady business practices that TCTMNBN pursues.

 

Yes, but the last time I received such a call they told me that because they were calling from Austria then the law did not apply to them!

 

Although I made it clear never to call me again.

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5 minutes ago, dj_jay_smith said:

Yes, but the last time I received such a call they told me that because they were calling from Austria then the law did not apply to them!

When I get cold-callers who try crap like that, that's when I start swearing at them loudly and insinuating that their ancestors may have been canines that copulated with swine. I even had one cheeky bastard try to threaten me with Beleidigung charges - I said "Good luck with that, you're not in Germany".

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1 hour ago, dj_jay_smith said:

Yes, but the last time I received such a call they told me that because they were calling from Austria then the law did not apply to them!

 

Although I made it clear never to call me again.

 

 

That is bullshit and there are even EU-court-decisions to make clear that this is not a way around the German laws..

 

Cheerio

.

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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Hello Starshollow,

 

Unfortunately, I am one of deVere's victims in Germany. I have been living in Munich since June 2014. On their advice in March 2017 I switched my QROPS (Executive Investment Bond) from a Guernsey based trust to one in Malta with resulting negative financial consequences. Currently, I am challenging deVere's handling of the transfer and demanding reimbursement of the losses I have incurred as a result. 

I have followed Starshollow's blog on Toytown and note that you say that deVere are not licensed in Germany to give advice on QROPS transfers.
In response to my formal complaint, deVere sent me the following link (which I am unable to open) which they state confirms that they are fully licensed to provide QROPS advice in Germany.

 

"I can also confirm that the business in Germany was suitably registered. The regulator for deVere Germany GmbH is registered with the insurance agent register (http://www.vermittlerregister.info registration no. D-8HD0NHM21-08). deVere Germany GmbH has a license according to sec. 34d German Trade Act (insurance broker), supervisory authority: Industrie- und Handelskammer, Frankfurt am Main, Börsenplatz 4, 60313 Frankfurt."

 

Are they now properly registered in Germany? If so, were they fully compliant with German licensing and registration requirements before March 2017 when they were advising me to move my QROPS (Executive Investment Bond) to Malta?

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This is from their website:

 

Quote

deVere Germany GmbH. Trading Office Address: Schillerstrasse 14, Frankfurt am Main, Frankfurt, 60313, Germany. Managing Directors: Andrew Oliver, Nigel Smith and Daniel Welker. deVere Germany GmbH is registered in the local court of Frankfurt am Main under HRB 55281. It is registered with the insurance agent register (http://www.vermittlerregister.info registration no. D-8HD0NHM21-08). deVere Germany GmbH has a license according to sec. 34d German Trade Act (insurance broker), supervisory authority: Industrie- und Handelskammer, Frankfurt am Main, Börsenplatz 4, 60313 Frankfurt.

 

That doesn't make it true, of course. 

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Hi Starshollow,

They are onto me now as well.

While I am interested in a transfer it is not with them!!!

Are there alternatives?

 

 

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HI Cavok, can well imagine... :-)

If you mean a transfer of a UK private/company pension plan out of the UK: you should always only look for or accept advice that is fee-based and not commission-based for a plentitude of good reasons. These companies only offer commission-based advice and also in my experience have no clue about the options you have in Germany with German pension companies to transfer to in a QROPs compliant manner.

 

We ourselves offer such advice if you are interested: https://www.crcie.com/financial-advice/qrops-transfers-germany/

The total costs can be made entirely transparent for you so that you can easily understand if it makes sense for you or not. It also very much depends on whether you own a DB (defined benefits) pension plan where the regulation makes the transport more complicated/complex and thus the advice process more expensive or a DC (defined contributions) pension plan. With the latter, the main difference then is whether the plan as what is called by the FCA  seriously "safeguarded benefits" or not.

 

Cheerio

 

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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Update: DeVere Germany is apparently - looking at what clients show me as communication with some local "advisors" and their LinkedIn profiles - still running offices in Frankfurt and Munich.

 

Please be advised:

DeVere Germany currently has not a single license in Germany anymore for either financial advice (investment advice) nor insurance advice (to which pension plans would count under German legal definition).  So, anyone approaching you - and also remember that cold-calling is illegal in Germany, no exceptions - is not licensed in Germany and if you have complaints or problems later, no German authority will be able to support you, neither the Ombudsman nor the IHK Frankfurt (regulatory body for insurance advice) or BaFin (regulatory authority in Germany for investments)

 

Apparently - from what I have seen in one communication to a client of DeVere in Germany - DeVere advisors/salesmen claim to act in Germany under the freedom-of-services act granted by the European Union from DeVere Spain.   Freedom-of-services, however, allows for cross-border activities only. I.e. advisors in Spain may if the client is willing to deal with Spanish consumer protection laws and all, i.e. willing to move outside German consumer protection, advise from Spain into Germany. And on some occasions even travel for a meeting to Germany. But running a legal entity like DeVere Germany GmbH is NOT covered by the Freedom-of-services. this would require a "Freedom of Establishment" from Spain into Germany, however, the entity in Germany would then, of course, become liable for regulation here in Germany if permanently established. 

According to the imprint on DeVere Spain website, they only have a license as insurance broker (if I understand this correctly) with cross-border allowances from Spain but definitely not Freedom of Establishment. 

 

If you are being approached directly by Devere Germany:

1. let them know that cold-calling is illegal, that you will be taking note of the day and time and name of the caller so that other licensed parties (like me) can issue a cease&desist order against them for violating German consumer protection laws (that should take you off their list for good.

2. if you have already started dealing with them: demand proof of license/registration and double-check this with the local IHK (Frankfurt or Munich) or BaFin. You will quickly learn that no such license exists which means you have no recourse in cases of troubles and also no professional indemnity insurance can be claimed against in case you lose serious amounts of money.

 

Cheerio

 

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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