# Helvetia Wealth ?



## Lemurz

8% p.a. return guaranteed over 2 years - per todays SBP.

www.helvetia-wealth.ch/emtn

Anybody heard of this outfit before?
Suppose there must be some catch?


----------



## Panzraam

Strongly suspect they aren't licenced in Ireland. You can check by e-mailing registers@financialregulator.ie and requesting they check. Approach Swiss investment management firms with caution as they have minimal regulation in Switzerland.


----------



## Helvetia

Please contact the company directly should you require further information.


----------



## Brendan Burgess

This ad which appears in the Irish Times today appears to  me to be in gross breach of the Consumer Protection Code. 

The headline is "8% growth guaranteed" . But it is not possible to get any of the details of the product in the ad or on the website without registering. 

There is one thing quite sure. This product is not paying 8% interest as the ordinary consumer understands it and so is misleading. 

I have complained it to the Financial Regulator. 

Brendan


----------



## ClubMan

Anybody able to scan, host and link to the ad in question? Or email a scan to _Brendan _and we/I will host it.


----------



## Guest126

It reminds me of the Ben Affleck movie - 'Boiler Room' - good show, don't touch the investment with a barge pool.


----------



## Brendan Burgess

It's a full page ad, but with very little text, so here goes...



> 8% Growth.
> Guaranteed.
> 
> That's an eye-opener
> 
> Guaranteed 8% Coupon
> Euro Medium-Term NOte(EMTN)
> 
> If you have money to set aside for 2 years,and you want to see 8% growth per annum,you could be one of the first private investors in this conditional capital Guaraneed bond.
> 
> +Guaranteed 8% coupon for two years
> +Guaranteed by an aa-rated bank(Voted Euromoney's "Best Global Bank 2006")
> +Only available to Helvetia Wealth Clients
> +No redemption or penalty fees after 18 months
> +Maturity 3 to 7 years
> +Daily liquidity and listed
> +Closing date 28th February 2007
> 
> 
> Helvetia Wealth(Liechtenstein) AG is authorised and regulated by the FMA. It is a Swiss and Liechhtenstein-based Wealth Creation and Asset Management Company. The company is authorised to operate in Ireland , Germany, Sweden and the UK.
> 
> This document, which constitutes a financial promotion, has been approved by Helvetia which is authorised and regulated by the FMA.


----------



## Brendan Burgess

It will be very interesting to see how long it takes the Financial Regulator to deal with this. 

My guess is that Helvetia will have attracted a lot of deposits before anything is done. 

It seems to have first appeared last Sunday and no action has been taken yet.

Brendan


----------



## max

I noticed them yesterday, they have advertising banners on examiner.ie, business section


----------



## ClubMan

Are they not at least supposed to quote the relevant _CAR_?


----------



## MugsGame

No -- it seems to be akin to a bond rather than a deposit account. 

3-5 year maturity would explain how they can "guarantee" a return only for first 2 years. Hard to square that with possibility of redemption after 18 months though. I guess the underlying value of the coupon may fall though, so you might get the 8% p.a. return, but could end up with just your capital back when you add everything up (hence the conditional capital guarantee whatever that means.).


----------



## babytooth

with regard to "car"...under "passporting" through the MiFID directive, a maximum harmonisation EU directive, all financial service providers have to confirm to the host country rules, this would be Germany in thier case (have a german based office) where this is not a prequisite. 

Paying a coupon of 8% means just that, an annual coupon of 8%, 8 euros for every 100 invested. Nothing to say that "car" must be published, as outlined by MiFID. It is a part of our new "Consumer Protection Code" but this doesn't operate cross border.

Also, an EMTN paying 8% coupon is totally plausible, guaranteed as it is linked through a credit linked note (ie a wrapped mtn and cds). It is high, as the spread appears large over the floating 2y swap rate.

Would wonder as to the MTM (market price of this Medium Term Note (MTN) )...might not be too liquid and may be overly sensitive to a change in rates through their price, whihc would make early encashment a big loss maker...

if you want to enquire further on this, as them for the ISIN and RIC, you can then confirm all details through any of the rating agencys or market data sys.

Hope that helps.


----------



## Sunny

babytooth said:


> Also, an EMTN paying 8% coupon is totally plausible, guaranteed as it is linked through a credit linked note (ie a wrapped mtn and cds). It is high, as the spread appears large over the floating 2y swap rate.
> 
> Hope that helps.


 
Where did you get this from?


----------



## Conan

My understanding of the Helvetia offering is as follows:

The 8% coupon is in years 1 and 2 only.
The maturity of the bond is 3 to 7 years
The 8% return to Irish investors is subject to marginal tax and PRSA and Health levy, thus for top rate tax payers a tax hit of 47%. This is not a 23% "exit tax" product.
It is not clear what is paid post 2 years, but surely likely to be less than 8%. Seems like the old "three card trick" used in the past by some With Profits contracts, by front-loading returns into the first 2 years.


----------



## paddyb

I am surprised that Helvetia's website does not fully explain the product.  You have to talk to one of their advisor to get full details - perhaps thats how they operate in Switzerland.

In general I believe that we should welcome the fact that foreign firms are now looking to sell product into Ireland on a passported basis especially since the range of product on offer in Ireland is quite limited.  

Of course we should look closely as any product whether offered by an Irish firm or an overseas firm.  Its just a pity that many people seem much more wary of these types of financial products than of property.  If Helvetia had advertised an 8% yield on East European property would anybody have batted an eyelid - at least this product does not involve any form of gearing by the investor? 

Would be interesting to raise with the Financial regulator if the normal €15,000 deposit protection would apply in this case if Helvetia defaulted. 

I suspect that the Helvetia product is similar to some of the yield enhancing products sold in places like Germany when interest rates fell to around 2%. These are a type of structured deposit with built in call features.  As I understand it the investor the high initial coupon is counterbalanced by the interest rate vol that the Bank gets.  

Would be interesting to see what information Helvetia provide - you would expect full disclosure of the types of payoffs that would apply in various scenarios.


----------



## ClubMan

Maybe the _Helvetia _representative who posted earlier could take this opportunity to explain the product here on _AAM_?


----------



## Brendan Burgess

I spoke about the status of the ad to the Financial Regulator's information section. 

They do not have to comply with the Consumer Protection Code as it is a MiFid Product.

However, they do have to comply with the advertising guidelines in the Handbook for Investment and Stockbroking Firms ( published in 2000) 

This apparently has very specific rules about the use of the term "guaranteed". 

I have to say that I am not optimistic. General Principle 1.3 of these guidelines is that an ad must be fair and not misleading. The FR rejected my complaint that the BCP Quadruple Growth Bond was unfair and misleading although it never paid anyone quadruple growth of their investment. 

They will probably also reject my complaint that "8% guaranteed" is unfair and misleading. 

But unfortunately, the confidentiality obligations, means that we will never know the outcome. 

Brendan


----------



## ClubMan

In my experience the _IFSRA _consumer complaints process is a joke and certainly not consumer friendly. They just quote tracts of legalese from section something or other and hope you go away. If you persist something may happen but, as you say, usually you will never know. I wouldn't bother complaining again. It took me about four attempts to convince them that a certain bank's claim that they were offering the best demand deposit rate was bogus even though it was a completely cut and dried case of misleading financial advertising.


----------



## gonk

Brendan said:


> The FR rejected my complaint that the BCP Quadruple Growth Bond was unfair and misleading although it never paid anyone quadruple growth of their investment.


 
Maybe you had some influence - Ch. 2, Par. 1 of IFSRA's 2006 Consumer Protection Code says: "A regulated entity must ensure that the name of a product or service which it provides is not misleading in terms of the benefits that the product or service can deliver."


----------



## Brendan Burgess

Hi gonk 

I made a lot of submissions to IFSRA on the code and lots of complaints about tracker bonds. The codes reflect some of my points. They are barred from discussing complaints with members of the public so it feels as if they are doing nothing. One can only judge by what happens in public. 

For example, if the Helvetia ad continues to appear, it suggests that they have done nothing, apart from investigating it. The BCP Quadruple Growth Bond is still advertised as such, despite the Consumer Protection Code. I can't understand it, but the Regulator can't tell me why.

Brendan


----------



## ClubMan

Oddly enough, when I made the complaint above and they eventually saw the light they did tell me that they had spoken to the institution in question who had agreed to pull the ad although I suspect that the advertising campaign had run its course. However in all other cases when I made complaints they quoted the section whatever secrecy act to me.


----------



## Saudi

Hi

Thought I would bump up this thread.  I sent an enquiry in to this crowd a few months back and they have contacted me a couple of times since then.  They seem to have a slick sales pitch, detailed references to our previous phone calls, news paper clippings reviewing products etc.

They sent me out information on a product with a 48 month life span, whereby the return on your investment is based on the most successful of three separate funds during that period.  Each fund has a separate focus - 1. Equities; 2. Commodoties; and 3. Bonds. Your capital investment is guaranteed, minimum investment is €10k,  6% admin/mgt fee on joining and no redemption fee.  

Sounds quite good to me but I'm sure there is a catch, they're sending me out the terms and conditions.

Has anyone else heard of this product??  A quick read through the thread makes me thing there is an awful lot of scepticism about this company are they to be trusted?

S


----------



## ClubMan

Saudi said:


> Your capital investment is guaranteed


How do they achieve this (nominal!) capital guarantee?


> 6% admin/mgt fee on joining and no redemption fee.


Any other charges such as annual management fees? If not then are you sure that any underlying instruments/derivatives don't subsume the charges?


----------



## Saudi

As I said I haven't seen the t&c so don't know.

No annual mgt fee, the 6% covers all fees and charges apparently.


----------



## Helvetia

Please contact us directly for further information.

0041 44 567 2222


----------



## Brendan Burgess

A friend of mine who responded to the ad got a load of literature and many phone calls from Helvetia.

It is impossible to understand the literature. It is badly written. 

I have a simple question Mr Helvetia. Very simple and the answer is either yes or no.

If I put €10,000 in this product today, am I guaranteed to get back €11,664 when I cash it in two years? 

Brendan


----------



## Helvetia

Please contact us directly for further information.

+41 44 5672222


----------



## z108

Out of curiosity, I'd like to know more about  the difference between  the aggressive, one balanced, and one defensive fund. Are these managed funds or index trackers?


----------



## Brendan Burgess

Thanks you for a clear reply. Your ads are misleading and I am astonished that the Financial Regulator continues to allow them:



> 8% Growth.
> Guaranteed.
> 
> That's an eye-opener
> 
> Guaranteed 8% Coupon



You are not guaranteeing 8% growth, yet investors are investing with you expecting it. 

My expectations are totally irrelevant to this discussion.

Brendan


----------



## Helvetia

Please contact us directly for further information.

+41 44 5672222


----------



## Helvetia

Please contact us directly for further information.

+ 41 44 567 2222


----------



## Brendan Burgess

My expectations are that if you advertised a rate of 8%, then you should pay it.

My expectations are that you should not mislead people. If you have managed to mislead IFSRA, fair play to you. But you should not be misleading the public. 

Brendan


----------



## Helvetia

Please contact us directly for further information.

+41 44 567 2222


----------



## z108

Brendan said:


> I have a simple question Mr Helvetia. Very simple and the answer is either yes or no.
> 
> If I put €10,000 in this product today, am I guaranteed to get back €11,664 when I cash it in two years?
> 
> Brendan




Didnt Helvetia respond with a 'No' to this yesterday ? 

Is Helvetia legally allowed advertise this way in the rest of Europe or is it just our code which is flawed?

Would the regulator respond to a freedom of information request ?


----------



## MugsGame

sign said:


> Didnt Helvetia respond with a 'No' to this yesterday ?



They did, but they've now replaced all their previous responses with their phone number. I've deleted most of them, including the posts where they originally asked Brendan his expectations, which is why he appears to be having a conversation with himself!


----------



## brenno

I see this crowd are now offering a bond offering 9% gross to run from one to six years, linked to basket ot 30 stocks.  Say fixed copupon paid every year regardless of the performance of the 30 stocks, claim gross is equivakent to 5.5% net of income and CGT.
Given what was written on this post last year, anybody any views on this?


----------



## MikeS

I came across your blog today. I am surprised to hear such a negative opinion. I must say that does not mirror my experience with these lads. They showed me these capital protected bonds early last year, and I must say I think they were right.

happy investor.


----------



## yob

hi guys,
haven't been on for a while,interesting one;i've been dealing with this co' for almost 2 years,origonaly investing in equities as recommended,done very well,sold out as advised early last year,bought gold,and 2 of these garanteed bonds your discussing,as you can imagine done well to get out of equity and likewise to buy commodities when i did,one of the bonds is doing very well,one not so well but this one is 95% garanteed so i'm not worried,yes this is a progressive company and there searching global markets for products and obviously want you to keep adding to your portfolio with them,thats what they do.
i'd also like to mention that they recommended me sell my irish stocks in april,does this sound like a company that knows what there doing??
there front loading fees are presently being abolished and are going for minimal annual fees (depending on underlining co')so each product will be mesured on its own merret.
they also have an office in peters st d2,hope this helps some,yob


----------



## Conboyj

The Irish Forestry Fund work with these guys to sell there international forestry fund (see here > www.*ifs*am.ie_ )_maybe a running theme for discussion but IFS incidentally have also had there advertising standards discussed here > http://www.askaboutmoney.com/showthread.php?t=6699 I know that Brendan has recommended this scheme in the past however 
I have a few questions that would concern me in any investment, the first thing I would ask is what experience do the operators have, taken from the IFS website there are three directors Richard Hoare, worked for the BOI he has never studied forestry from what I understand!, Trevor McHugh from what I understand also does not know about forestry!
Paul Brosnan studied marketing! I still can’t see the relevant experience in the sector for there investment vehicle.
There are a few more concerns the primary concern being that even the most optimistic forester would say that there is no value in “semi-matured” forestry. Most foresters have lower overheads than IFS and equally they would not expect the level of returns they state over the timeframe. IFS have never shown a return apart from on paper based on evaluations from there forester! 
IFS asset managers are NOT regulated they sell there shares as directors! if you look at some of there press such as here > http://www.irishforests.com/investment/investment-in-forestry they put an argument that its because forestry is not regulated in Ireland, this is the worst reason I have ever seen for not getting regulated as they are selling shares if they wanted to get regulated (or could!) they would.
Helvetia Wealth are also in a country with little or no regulation and know obvious connection to the Irish forestry fund! Apart from that I’m sure everything is fine and they are doing it for the love of forestry and not just high commissions!....To be continued I'm sure.


----------



## Conboyj

This link > http://boards.fool.co.uk/Message.asp?mid=10585095&sort=whole also draws some conclusions between FSW securities and Helvetia Wealth AG.
Mark Griffiths is the sales director of Helvetia Wealth and also apparently worked for FSW Europe there is another link here that shows Mark Griffiths replying in the Forum> http://boards.fool.co.uk/Message.asp?mid=10453865
Tony Hetherington who works on the FSA consumer panel also writes for a number of publications in the UK and warned about FSW Europe here > http://www.thisismoney.co.uk/investing/article.html?in_article_id=414037&in_page_id=166 this outfit was regulated in Switzerland and sold primarily to the UK and Ireland.
From what I understand in regards to Helvetia Wealth from the Independent here> http://www.independent.ie/business/personal-finance/investments/swiss-investment-option-clocks-in-42918.html they are also originally Swiss (not based in *Liechtenstein*  
) there website is in English and not German? And they also say that 60% of there clients come from Ireland here > http://www.finance-magazine.com/supplements/altenative_investments_for_hnwis/display_article.php?aid=8095 I would have serious hesitations with what appears to be connections with Switzerland, FSW Europe and the staff who worked there, I would also like to know more about IFS asset managers partnership for there international forestry fund with this crowd?


----------



## William Kidd

babytooth said:


> with regard to "car"...under "passporting" through the MiFID directive, a maximum harmonisation EU directive, all financial service providers have to confirm to the host country rules, this would be Germany in thier case (have a german based office) where this is not a prequisite.
> 
> Paying a coupon of 8% means just that, an annual coupon of 8%, 8 euros for every 100 invested. Nothing to say that "car" must be published, as outlined by MiFID. It is a part of our new "Consumer Protection Code" but this doesn't operate cross border.


 
Yes - the MiFID has caused A LOT OF PROBLEMS for investors with the
(UNREGULATED ) notorious 'passport' system introduced by EU Commissioner, Charlie McCreevy. It has been ill conceived and provides 
little or no protection for the consumer/investor. 'Stock Brokers' or 

'boilerrooms' can very easily receive a licence from the German Regulator BaFin It is believed some of the 'outfits' moved from UK to Germary because the FSA were too strict ! ! . I see a mention of FSW Europe 
GmbH (formerly IS Intersecurities GmbH) - a Frankfurt outfit mentioned 
who dissappeared within 3 years from start up because of litany of 
complaints being made. In submissions to IFSRA & FSA on behalf of 17 
investors we were referred to the 'host' reuglator in spite of the fact that 
both IFSRA & FSA had permitted (in name) 'Stockbroker' to say on their 
stationery they were authorised and regulated by IFSRA and FSA - but 
hands appear to be tied for these two regulators who washed their 
handsof the problem and referred the complaint to BaFin. Dealing with thelatter is an experience. Helvetia may be a Swiss registered company but see they also have an office in Germany and Ireland . So who is the 
licencer for Germany and Ireland . It's no wonder these 'outfits' would 
hightail it to Germany to avail of the terms there and use the MiFID which 
has FAILED miserably tp protect the Consumer/investor. Some investors 
were unknowingly sold regulation S shares - one had shares in a secure 
investment in Ireland (€60000) which he transferred to include a number 
of stock with a promise of 100% to 300% within 3 years . It has been 
charged that the 'boiler room' took an undisclosed 60% commission 
and the issuer got 29% - most of the funds were channelled via various 
sources to end up being LAUNDERED in Hong Kong. One of the culprits 
was jailed in November last for handling $90m and the Regulators do'nt 
know where the money went ! No wonder Helvetia would operate from 
Germany and Peter St., Dublin, Ireland !

MiFID - Markets in Financial Instruments Directive
"The EU Markets in Financial Instruments Directive (MiFID), is the most significant piece of European legislation for the capital market of recent years. It governs and harmonises the conditions for securities trading throughout Europe. MiFID is also intended to improve investor protection in Europe, through new conduct of business and transparency requirements, and to promote competition between trading platforms." (www.bafin.de)

Further information about MiFID and the corresponding documents issued by Helvetia Wealth can be found on this site soon.

Very few financial institutions have escaped the fall out from the scandals 
in the USA and until the SEC, FSA and IFSRA become effective the place for your money is 'under the mattress' !


----------



## Brendan Burgess

this company now seems to have gone bankrupt


----------

