Here we take a look at the DeVere Group which is dogged by online controversy in almost all the jurisdictions they operate.
In the 2017 Finance Bill, Her Majesty’s Revenue and Customs (HMRC) proposed that:
Transfers to qualifying recognised overseas pension schemes (QROPS) requested on or after 9 March 2017 will be taxed at a rate of 25% unless at least one of the following apply:
· both the individual and the QROPS are in the same country after the transfer
· the QROPS is in one country in the EEA (an EU Member State, Norway, Iceland or Liechtenstein) and the individual is resident in another EEA after the transfer
· the QROPS is an occupational pension scheme sponsored by the individual’s employer
In response, the DeVere Group announced a strategic review. According to a statement printed by FT Adviser, at March 2017 QROPS represented approximately 20% of its business. In 2010, DeVere claimed to have advised on around a third of all QROPS transfers (since the creation of QROPS in 2006).
The DeVere Group (also styled deVere, and not to be confused with Charles de Vere, the UK independent financial advisor), is dogged by online controversy in almost all the jurisdictions they operate. Their business model is to hire advisors without industry experience, and place them wherever there are British expatriates, paying them commission only. All setup costs are met by the adviser (training, flights, and accommodation deposit). They’re also in charge of finding their own clients.
Group subsidiaries have been found by regulators to advise on products for which they lack the appropriate regulatory permissions. In 2011, the Daily Mail published an article entitled “Publish at your peril”. This set out the case of a British couple, retired to Cyprus, who were advised to invest in two Premier funds (one was compulsorily redeemed, the other was frozen, the couple lost around £60,000). It was then that they, and the journalist, found that deVere had passported its permissions from Belgium, where its license only covered insurance intermediation (not investment advice). In 2013, the Mail covered a similar case, involving four unnamed funds, a failed investment of £285k, and advice given by a Spanish office of deVere, under the same Belgian insurance license. Also in 2013, the Belgian regulator (the Financial Services Market Authority) confirmed that deVere and Partners (Belgium) ltd BVBA was included on a list of “disappeared intermediaries”.
A 2014 article by the Mail described an investment in the UAM Strategic Growth Fund (suspended in February 2013). The Mail connected the fund with United Asset Management in Valais, Switzerland: “records in Valais show that until September 2012 UAM was wholly owned by deVere boss Nigel Green.”
The client complained that the fund did not meet their attitude to risk, and had lost a quarter of their savings. The journalist contacted deVere’s London office, and soon after the client “emailed … to say that [they] could ‘not discuss this matter any further’”.
In 2013, the South China Morning Post said “Global chief Nigel Green owned shares in several subsidiary businesses that profited from the insurance plans sold by deVere”. The article continued:
Generali, the vendor of one insurance plan linked to the Valais fund, inserted a statement revealing Green’s position on the fund, saying: “Nigel Green, CEO of deVere Group, is a director of and holds a majority shareholding in Valais Investment Management Sarl, the fund adviser.”
Valais Investment Management and United Asset Management share the same business address, according to the commercial register of Low-Valais, which lists Frontier Holdings as the sole shareholder of United Asset Management.
Frontier is registered in Gibraltar, and it has changed its name to Titanium Advisers, according to the companies registry in Gibraltar.
The registry has no record of Green’s involvement in Frontier, but it does record that Beverley Yeomans was a director of the company from November 2009 to October last year. Yeomans is Green’s personal assistant.
Searching for references to the Strategic Growth Fund and its suspension led to a South African website named Moneyweb. This reported one side of a dispute between the South African operators of Belvedere, and deVere Group’s Nigel Green. Belvedere was covered by Offshore Alert, a newsletter published by David Marchant. The main story resides behind a $90/month paywall, but the summary is enough: “Offshore fund group Belvedere Management, which claims to have $16 billion of assets under administration, management and advisory, appears to be one of the biggest criminal financial enterprises in history, headed by David Cosgrove, Cobus Kellermann and Kenneth Maillard.”
Later, deVere Group revealed that it was behind information received by Marchant (who specialises in exposing international financial scams). In the meanwhile, Alec Hogg, writing on biznews.com explained that Belvedere (via Kellermann) was UAM’s fund manager.
In the US, deVere failed to progress a lawsuit against pissedconsumer.com (and its parent Opinion Corporation). Rather than focusing on defamation, it tried and failed to argue that Opinion Corporation’s use of the deVere trade names violated section 43(a) of the Lanham Act. UK readers should know that the US usage of “pissed” indicates dissatisfaction.
Finally in the UK, and as covered in another article, a deVere subsidiary (deVere and Partners (UK) Limited) has been required by the Financial Conduct Authority to “Immediately cease to provide third party companies with TVAS/DBAR reports or other similar report of information designed to assist third parties companies in transferring customers DB pensions to an alternative arrangement.”
The third parties may well have been other non-UK regulated group subsidiaries. And the Transfer Value Analysis (TVAS) reports might not have covered the very significant costs levied by the QROPS operator. A case of HMRC advancing the FCA’s position.
Whither next? Well, DeVere Group has just acquired a St. Lucia based private bank (Arton Bank). The Guernsey Financial Services Regulator took the firms controlling the Belvedere funds into administration, citing “systemic failings in corporate governance and the application of law, regulation, code and principle”.
And anyone reading this should suspect offshore investments delivering high returns whilst describing themselves as low risk.