Where can I find an Independent Financial Advisor?

[Steven Barrett]

Think S Barrett should get clarification in relation to ETFs.

I think he is mistaken in believing that he could give advice on what are collective investment schemes.

My Statement of Authorised Status from the Central Bank:

Bluewater Financial Planning Limited (‘the firm') (Ref. No. 118735) is
authorised under Section 10 of the Investment intermediaries Act, 1995 (as
amended).

As a Multi-Agency Intermediary, Bluewater Financial Planning Limited is authorised to receive and transmit orders to product producers from whom a written letter of appointment is held, in relation to:

1. Shares in a company or bonds that are listed on a stock exchange, prize bonds

2. Units or shares in undertakings for collective investment schemes, including unit trusts and UCITS

3. Tracker Bonds

4. Insurance

5. Personal Retirement Savings Accounts (PRSAS)

The firm is also authorised to act as a deposit broker and to give advice in relation to deposits.

The firm may also give investment advice only in relation to investment instruments available from those product producers from whom an appointment is held.

When receiving and transmitting orders in relation to insurance policies and/or
PRSAS, the may only accept cash or cheques/bank drafts from clients payable to itself where:

(i) an insurance undertaking has invited renewal of a policy of insurance, or
(ii) a proposal for insurance and/or PRSAS has been accepted by an insurance
undertaking.

In all other circumstances cheques/bank drafts or other payment instruments must be made payabie to the product producer.

 

[Bronte]

US Citizens, dual US and Irish Passport holders and anyone with a US Green card living in Ireland. These people all have to file an annual tax return with uncle Sam and there is a very strong argument that these people should not be holding any European funds (note pensions are broadly speaking exempt)

.

You're all in agreement on this, but why shouldn't American's be allowed to invest in European funds? Just because they have to file an American tax return?

 

[Steven Barrett]

That is bizarre, and I think it should be clarified with the Central Bank, as I am sure it is not intended.

If I ask you where should I invest €100,000 while I have a mortgage of €200,000 @ 5%, I think it would be wrong of you not to set out the option of paying off the mortgage.

I can't imagine that the Central Bank would reprimand you for giving good advice. But then, you never know. The CB are great on rules. If they see a rule being broken, they are confident. They are not good at exercising judgment.

The response from the CB to my question:

In order to give advice on mortgage products and services, you would need to be authorised as a mortgage intermediary under the Consumer Credit Act 1995.

Doesn't tell you much. Proceed with caution...

 

[Marc]

Bronte says:

"You're all in agreement on this, but why shouldn't American's be allowed to invest in European funds? Just because they have to file an American tax return? "

The new FATCA agreement transforms the reporting and compliance tools available to the IRS. U.S. persons living in Ireland will have to pay new attention to many long standing reporting and filing rules that have been widely and safely ignored until now i.e. FBAR or PFIC. Failure to comply with these rules has very rarely been an issue because they were virtually unenforceable. With FATCA's new reporting mandate via the Inter-Governmental Agreement with Ireland all this will change.

 

[Monksfield]

The firm may also give investment advice only in relation to investment instruments available from those product producers from whom an appointment is held.


In saying the above you have confirmed that you could not advise on ETFs since you do not get agencies from ETF provider : you can advise on insurance company products. Everything else (such as collective investment schemes, shares ) is receive and transmit.

I don't know SBarrett and he/she may be one of the very excellent MAIs out there but people need to understand that the scope of what they can advise on is very restricted.

 

[Marc]

Hi Monksfield,

You are correct that you do not obtain agencies with ETF providers. Since they are "exchange traded" an adviser needs an agency with an execution venue.

I have previously checked this specific point with the Central Bank and they advised that advisers can hold agencies with other intermediaries who are themselves authorised to act as an execution venue. Provided that the advisers themselves are authorised to advise on the underlying securities.

When providing our portfolio services to other intermediaries we require the adviser to obtain from the Central Bank specific authorisation for items 1 and 2 listed on S Barrett's statement of authorised status.

1. Shares in a company or bonds that are listed on a stock exchange, prize bonds

2. Units or shares in undertakings for collective investment schemes, including unit trusts and UCITS

As we are a "Master Broker" or "Product Provider" in the lexicon of the Central Bank, this means that we can act as an aggregator/execution venue to receive and transmit orders in transferable securities and UCITS from other advisers who are themselves authorised to advise on these securities - even if they themselves do not have an agency with the underlying fund managers.

 

[Jim2007]

You're all in agreement on this, but why shouldn't American's be allowed to invest in European funds? Just because they have to file an American tax return?

In a nutshell, the new US tax laws place heavy administrative burdens on anyone providing financial services to a US citizen or green cardholder. Right across Europe financial institutions have simply decided, as is their right, to stop doing business with such persons and avoid the costs and potential penalties if they get it wrong.

From a financial services point of view US Citizens, Green card holders and partners or children of such people are becoming toxic! Some of the things I've come across so far:
- Swiss banks turn away anyone who meets this criteria, often by the doorman!
- About 6 months ago Swiss banks sent a letter to all such person they could identify, giving them 3 months to close their accounts or they'd do if for them
- The Swiss Post bank issued a letter to anyone had opened a children's gift account, telling them that if the intended child lived outside the EU/EEA they must close it within a month or it would be done for them
- The number of US citizens given up their citizenship at the US Embassy in Bern has gone from less than 100 a year ago to over 2,000 this year so far.

For a financial institution, the penalty for failing to comply include having their US licence withdrawn and being unable to deal in US government securities of one type or another. Pretty much every financial institution needs to be able to interact with the US banking system and trying to develop an kind of investment product without access to US government securities is extremely challenging. So they are all playing save on this one.

 

[joiedelivre]

Am I being naive or are those worried about the US crackdown worried because their advice doesn't stack up with new controls: 'if they get it wrong'? And isn't it the lack of such controls that got the world in the mess we're in now? I work in Ireland, have 2 passports, return tax forms to both countries and haven't had any difficulties...so its sounds like scare-mongering to me...

 

[Steven Barrett]

The firm may also give investment advice only in relation to investment instruments available from those product producers from whom an appointment is held.


In saying the above you have confirmed that you could not advise on ETFs since you do not get agencies from ETF provider : you can advise on insurance company products. Everything else (such as collective investment schemes, shares ) is receive and transmit.

I don't know SBarrett and he/she may be one of the very excellent MAIs out there but people need to understand that the scope of what they can advise on is very restricted.

Monksfield

I have agencies with companies who act as an "execution venue" as Marc describes.

When applying for the various levels of Central Bank authorisation, they do ask you who you will be seeking agencies off so that you can provide advice in each area.


I'm a he by the way, the S stands for Steven

 

[Titan]

In my experience its not the qualifications of the advisor that will guarantee you a better outcome. Its always better to seek out an individual with a good reputation than
an individual with a good qualification. Qualifications are hit and miss at the best of times.

I would agree with you there but how do you go about finding someone with a good reputation if your not familiar with this area or you don't know anyone that can point you in the direction of someone with a good reputation?

 

[Gerry Canning]

Am I being naive or are those worried about the US crackdown worried because their advice doesn't stack up with new controls: 'if they get it wrong'? And isn't it the lack of such controls that got the world in the mess we're in now? I work in Ireland, have 2 passports, return tax forms to both countries and haven't had any difficulties...so its sounds like scare-mongering to me...

...........................................

There was a good article in Economist a few weeks back.
It does appear that the US rules are complicated and should you get it wrong you will be hammered by them .