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Expats lose faith in FAs as bogus firms continue trading
| Published: | 2 Sep at 6 PM |
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In spite of repeated warnings by the UK’s Financial Conduct Agency, bogus financial advisors peddling dodgy investments, illegal pension unlocking schemes and online scams are still trading happily.
The warnings are listed on the FCA’s website which, it seems, is rarely visited by prospective investors who have already had contact with the scammers via cold calling or online advertisements. Although the FCA has regulatory powers in the UK, it’s far harder to deal with offshore fraudsters who clone respected financial websites and lie about their UK authorisation.
Several companies closed down by the FCA have been up and running again within hours. Meanwhile, results of a worldwide survey suggest that investors no longer trust financial advisors, and there’s little FAs can do to redress the balance.
The survey, carried out by the CFA Institute, revealed that FAs are now believed to lack ethics, pushing unsuitable products to their clients in order to gain high commissions. More than 50 per cent of those surveyed in Canada, the UK, USA and Hong Kong believe that most FAs would simply walk away when faced with challenges about their activities.
Recent media reports as well as blogs and posts online suggest that some expat investors are having a harder time than those in the UK and the countries which took part in the survey. Southeast Asia, including Malaysia, Thailand and Indonesia, the UAE and even Spain have all featured as hotbeds of dodgy dealing by unregistered, unethical FAs either acting independently or within investment firms.
Investors, it seems, now believe that transparency and trust are more important than financial returns, and the majority now trust the markets more than they trust FAs. CFA president John Rogers said the study sends a clear message to FAs that they need to clean up their act, adding that it’s time for investment companies to demonstrate their ethics, transparency and commitment to service.
The warnings are listed on the FCA’s website which, it seems, is rarely visited by prospective investors who have already had contact with the scammers via cold calling or online advertisements. Although the FCA has regulatory powers in the UK, it’s far harder to deal with offshore fraudsters who clone respected financial websites and lie about their UK authorisation.
Several companies closed down by the FCA have been up and running again within hours. Meanwhile, results of a worldwide survey suggest that investors no longer trust financial advisors, and there’s little FAs can do to redress the balance.
The survey, carried out by the CFA Institute, revealed that FAs are now believed to lack ethics, pushing unsuitable products to their clients in order to gain high commissions. More than 50 per cent of those surveyed in Canada, the UK, USA and Hong Kong believe that most FAs would simply walk away when faced with challenges about their activities.
Recent media reports as well as blogs and posts online suggest that some expat investors are having a harder time than those in the UK and the countries which took part in the survey. Southeast Asia, including Malaysia, Thailand and Indonesia, the UAE and even Spain have all featured as hotbeds of dodgy dealing by unregistered, unethical FAs either acting independently or within investment firms.
Investors, it seems, now believe that transparency and trust are more important than financial returns, and the majority now trust the markets more than they trust FAs. CFA president John Rogers said the study sends a clear message to FAs that they need to clean up their act, adding that it’s time for investment companies to demonstrate their ethics, transparency and commitment to service.
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