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[tylney]

I work for Credenda Associates here in Bangkok and we would only advise using Scottish Provident in Hong Kong to transfer to QROPS as it is highly regulated and because the fee structure is vary favourable to our clients.

As I mentioned before, please only consider QROPS if you have no intention of moving back to the UK.

Firstly you should know that Hong Kong is not highly regulated and either is the Scottish Provident QROPS. It is being missold to expats on a daily basis.

Secondly you should know that HMRC have their eye particularly on Hong Kong QROPS as they have a suspision that they are being missold and also more fundamentally that Hong Kong does not fulfill the pension taxation requirements to meet QROPS rules.

Thirdly you should be aware that HMRC has put a stop on ALL new QROPS registrations for Hong Kong in particular which happened a few weeks ago.

Finally you should be aware that if QROPS status is removed then the tax consequences to you clients can literally wipe out their entire pension fund up to 90% penalty.

Might be an idea to stop recommending this to your clients until the picture becomes clear and certain.

[Paul MBMG]

I work for Credenda Associates here in Bangkok and we would only advise using Scottish Provident in Hong Kong to transfer to QROPS as it is highly regulated and because the fee structure is vary favourable to our clients.

As I mentioned before, please only consider QROPS if you have no intention of moving back to the UK.

Firstly you should know that Hong Kong is not highly regulated and either is the Scottish Provident QROPS. It is being missold to expats on a daily basis.

Secondly you should know that HMRC have their eye particularly on Hong Kong QROPS as they have a suspision that they are being missold and also more fundamentally that Hong Kong does not fulfill the pension taxation requirements to meet QROPS rules.

Thirdly you should be aware that HMRC has put a stop on ALL new QROPS registrations for Hong Kong in particular which happened a few weeks ago.

Finally you should be aware that if QROPS status is removed then the tax consequences to you clients can literally wipe out their entire pension fund up to 90% penalty.

Might be an idea to stop recommending this to your clients until the picture becomes clear and certain.

Tylney, to be fair to Matthew, that's not really accurate

HK regulation was initially based on UK regulation and has stood up pretty well so far - I'd rate it as far more relevant than say SEC regulation in the US, which in many cases is up to 80 years out of date. Any trust anywhere in the world has to comply to HMRC standards to achieve and maintain its QROPS status

The SPI QROPS is an Isle Of man based product and also has to conform to pretty rigid regulations.

Your 3rd point should be clarified - HMRC was clearly shocked at abuses - as were we - and is looking at ALL trusts to make sure that they comply. Existing HK trusts merely have to demonstrate their compliance to retain their status. We've closely reviewed the available trusts and have found no abuses in HK unlike Sinagpore - the abuses in Singapore were blatant and we flagged these well ahead of HMRC action. So new QROPS are being written through HK every day and I, personally wouldn't expect any problems, based on the compliance that I've seen.

If QROPS status is removed?? Not sure what you mean - if a trustee loses their QROPS staus then you simply change trustee - if your own QROPS has been maintained in a compliant way then there should be nothing to worry about. The issue here is nothing to do with HK - it's not even really to do with QROPS; it's to do with trustees not complying with pension rules. It's unfortunate that some QROPS trustees have seen fit not to comply and that soem advisors have told clients it's OK to take out all their fund as cash. That was never the case and no professional advisor ever recommended that. Matthew's advice may contain a couple of omissions and errors but to my mind you're being totally unfair with your points, Tylney and Matthew should continue to review QROPS for his clients.

[GuestHouse]

Finally you should be aware that if QROPS status is removed then the tax consequences to you clients can literally wipe out their entire pension fund up to 90% penalty.

Steady on Tylney.. it's not the job of salesmen to give us the bad news.

Ooops I forgot 'If your own QROPS has been maintained in a compliant way then there should be nothing to worry about' .... that's one big 'If' when we are discussing people's pensions.

And it is an example of exactly why it is not a good idea to allow non unregulated and uncertified 'Agents' in a place like Thailand to arange a transfer of a pension fund into QROPS.

There is no legal comeback if they get that 'IF' wrong - They and your pension will have disapeared.

QROPS might be a good option for some people, for some it definitely will be a good option - But Why Oh Why the need to use an Uregulated, Unlicensed Agent in Thailand where there are no legal protections in place against mis-selling of these products?

Check out QROPS by all means 0 but use a Financial Advisor who is in the UK, Regulated by the UK, Licensed by the UK and who is answserable to UK law if he gives you the wrong advice.

Edited July 29, 2008 by GuestHouse

[Paul MBMG]

I'm sorry but Guesthouse's post contain the misleading, the controversial and the plain worng in various measures.

Ooops I forgot 'If your own QROPS has been maintained in a compliant way then there should be nothing to worry about' .... that's one big 'If' when we are discussing people's pensions.

No it's not - it's a basic requirement to follow a set of rules with any pension. In a very few instances in Singapore one or more trustees appears to have allowed pensionholders to behave in a non-compliant way. If the pensionholders decided to do this themselves without advice, it would appear bizarre. If they received advice to do this, then I would have thought they should be taking that up with the source of the advice while also taking legal opinion on whether the trustees have failed to fulfill their fiduciary duty. That is however only my gut reaction not knowing all the facts.

And it is an example of exactly why it is not a good idea to allow non unregulated and uncertified 'Agents' in a place like Thailand to arange a transfer of a pension fund into QROPS.

The Singapore trust that has attracted the bulk of the publicity was partly-owned by Credit Suisse - if there has been any breach of fiduciary duty then I would have thought that you stand a good chance of getting restitution from them!

If the source of advice was "'Agents' in a place like Thailand" and the pensionholders are based in Thailand then that makes any legal redress easier than if the agents were based in the UK or elsewhere. It also opens the door to other forms of redress such as reputational etc. A Thailand resident pensionholder who has received bad advice in Thailand should be hoping that the advice came from a Thai entity as the practical and theoretical avenues for pursuing any complaint are far better than if the 'agent' were based anywhere else. One obvious issue is that if a Thai based entity has breached its responsibilities to its clients then its Professional Indemnity Insurance shoudl cover that. Most UK forms take only PII that is good for onshore business transacted in the UK for the simple reason that they know that they are almost untouchable in respect of any deficient offshore advice given outside of the UK to non-UK residents. The only instance that I can recall of the FSA taking action against a UK IFA for any activities offshore are when a UK IFA certified the marketing materials of a boiler-room and received a fine of GBP 20,000 for doing so but may well ahve escaped scot-free if that certification itself hadn't happened within the UK. For a UK IFA to be liable all meetings and discussions would have to occur within the UK and any emaisl probably have to be generated from a UK server. Even then it's far from clear. The factors that the FSA consider with regard to marketing are

(1) the location of the QROPS content of a UK IFA website on a server within the UK;

(2) availability of QROPS to UK investors through other forms of media;

(3) any advertisement related to the investment directed at UK residents;

(4) the lack of any protection on the site to prevent access by UK persons;

(5) whether UK search engines or UK parts of search engines have been notified of the investment's site

Outside these criteria the FSA themselves claim no remit. Their remits are

to maintain confidence in the UK financial sector,

to protect consumers (UK-based consumers in practice)

to promote UK public understanding of the financial system

to fight financial crime in the UK.

Notice a certain theme? Non-UK agents' activities in the UK are clearly regulated and supervised. The 29,000 FSA member IFAs' activities outside the UK not so (there are agreements in terms of mutual responsibilitis for EEA member states' IFAs

There is no legal comeback if they get that 'IF' wrong - They and your pension will have disapeared.

QROPS might be a good option for some people, for some it definitely will be a good option - But Why Oh Why the need to use an Uregulated, Unlicensed Agent in Thailand where there are no legal protections in place against mis-selling of these products?

Check out QROPS by all means - but use a Financial Advisor who is in the UK, Regulated by the UK, Licensed by the UK and who is answserable to UK law if he gives you the wrong advice.

There is no such thing! Use a Thai-based IFA and you are in a much stronger legal and practical position to exact satisfaction - use a UK IFA and you're on totally unproven ground. There have been instances in many jurisdictions in the past of IFAs springing up for a short time and running off having created mayhem. Sadly this is as true in Thailand as in the UK. the only way to get around this problem is to try to pick an IFA whose interests are aligned to yours - who has even more to lose then you do from giving you bad advice; any IFA with an established thriving business is unlikely to jeopardise that for the sake of a quick Buck. There are several such IFAs in Thailand.

In short to protect yourself

1) choose an IFA in a jurisdiction where you can easily take legal redress

2) choose an IFA in a jurisdiction where you can easily take commercial redress

3) choose an IFA in a jurisdiction where their PII cover applies

4) choose an IFA that you trust

5) choose an IFA who has more to lose by giving the wrong advice

Personally I believe that this means an IFA established in the territory where the business is transacted and who is more likely to be concerned about the long trm impact of the advice than someone who lives and works 6,000 miles away in a different time zone and with dubious legal accountability!

[GuestHouse]

Personally I believe that this means an IFA established in the territory where the business is transacted and who is more likely to be concerned about the long trm impact of the advice than someone who lives and works 6,000 miles away in a different time zone and with dubious legal accountability!

Of course you would say such a thing... but then your pay packet relies others agreeing with you, being convinced to agree with you or perhaps being steered away from knowing the options that are available and the protections they miss out on by not going that 6000 miles.

[Misty]

I'm sorry but Guesthouse's post contain the misleading, the controversial and the plain worng in various measures.

I disagree. I find Guesthouse posts to be clear, concise, and spot on.

Misty