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April 4, 2010
Expat Financial Scams
A somewhat eye-opening experience last week.
I had a phone call from a company offering "independent" financial advice regarding offshore savings and pensions - to "make the most" of my residence abroad. The company in question will not be mentioned on here, but there is plenty of information about their dodgy business methods and even their recruiting strategies available on the web. To cut a long story short: It's nothing more than a scam: their representatives are usually not qualified financial advisors, but simply salespeople who will subject you to high-pressure sales tactics in the hope of getting their (huge, up-front) commission which is taken from your contributions, and can be as much as your whole first year's worth of payments.
While the underlying products they may advertise may be basically sound, they tend to be very expensive and unsuitable for people in my kind of situation. The worst thing, however, is that they often use restrictive contract terms which lock you in to paying huge fees which negate any potential tax benefits.
It seems like there's quite a lot of this kind of thing going around. Needless to say, I know where I'll tell any other financial "advisors" who call me to go...
Most readers probably think they're far too clever to fall for such a thing, but I've now experienced first-hand how powerful the illusion is and how easy it can be to fall under the spell, and it's very scary. Beware.
As ever, if something sounds too good to be true, it probably is..!
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