Strategic Asset Allocation was the pompous description coined by FINANSBANKEN A/S, taken over by Sparekassen Lolloland, to encapsulate a deceitful equity release product.
The sale of this financial sham was entrusted to a lady called Maria Tremurici-Falter, a Marbella socialite that does anything from complex financial products to charity expensive dinners or “knowing people”, and Michael (Mitch) Weisz, a mortgage broker who we cannot trace. They were both given a nice kick back of 1% of the value of the contract (at a minimum contract value of €1,000,000, not a bad day’s work!).
The below points give an idea of the monstrous set up Sparekassen Lolland came up with:
- Sold to unsophisticated foreign pensioners mostly that had no need to prove an income to qualify.
- Used the services of Costa financial pirates to market and sell the product.
- Offered the generosity of 1,5 hours of advice at the Guadalpin Hotel, by Danish-based staff who flew in the day before closing; the contracts being all ready to be signed off at the local Notary office.
- Used the services of valuers that were not regulated by the Bank of Spain, in spite of which they declared, on a public deed, that “…the valuers used are fully regulated by the Spanish authorities to carry out valuations for the lending market”.
- Flouted the laws applicable to investment products: lack of compliance with regulations pertaining to obligatory registration of prospectuses, informative triptych and contract with the CNMV.
- Indicated that 8% return was not an unreasonable return…when the product was taken out.
- And of course, were cleverer than the rest of Spanish banks by offering an “original” tax-dodging financial product that would alleviate the burden of horrible Spanish Inheritance Taxes.
Article 27 of the Unfair Competition Act (Ley 3/1991 de Competencia Desleal) states that:
“…practices that convey inexact or false information in respect of the nature or size of the danger that a user or consumer or his/her family would be faced with, should he not take out the service or product, are equally deceitful, and will be deemed illicit”
Is this not what all these banks came up with?
Documents
- 15-08-2012 – Sparekassen-Lolland-Reported-to-Bank-of-Spain (PDF 3.5 Mbytes)
Since the Equity Release Victims Association was formed some 12 months ago, together with the Asscociation Lawyers Lawbird, headed by Antonio Flores many banks have been exposed as being in breach of many of the Spanish Regulations. All these banks have had the opportunity of coming to the table to put matters right, yet have failed to do so even in the face of overwhelming evidence. Currently many of these banks have been reported to the Regulatory bodies who are investigating these banks internally. It would seem to me that the only way forward is to bring these matters to the courts as soon as possible and I know that Anonio Flores is compiling and compartmentalising all the necessary evidence to do just that.
Interesting that yet again this magical figure of 8% appears. In fact, in all the cases studied so far at least 8% is the norm promised return. Why is that I wonder. Perhaps the answer lies in what the banks feel is the minimum required to make these schemes viable for their victims, yet this is only part of the equasion. In all the expert advice we have received so far from independant financial experts, without fail they have stated that these schemes cannot work and the banks in question must/should have been aware of this. In fact in order for these to have any chance of success then the funds should have been placed in high to speculative investment funds, yet not one would have risked everything if this was the case. One also has to bear in mind that with the high commissions paid, set up costs and equity taken out there was no chance of these schemes working. Many of the schemes involved insurance policies, which our members were told would be necessary in order to mitigate taxes, including wealth tax, capital gains tax, income tax and more importantly inheritance tax. We now understand that these so called tax mitigations are not what they seem. If this is indeed the case then by having to pay any of these taxes would put a further burden on the victim, with the result that here is another factor that does not make the schemes viable. There is one further aspect in all this and that simply is where insurance policies are concerned, the insurance companies have a duty of “good faith” to the policy holder, one can hardly feel that the insurance companies have excercised that “good faith”. This latter point is contained in European Legislation which I believe has been adopted by the Spanish Government. Let me leave you with one final point. How many of these banks are still selling equity release products such as all our victims have subscrbed to, I will answer it for you NOT ONE. The truth of the matter is that these schemes have not worked and neither can they work ever, other wise the banks would have been out in force defending their schemes.
Have you ever wondered what the definitioin of scheme is, well would you might be surprised to know that SCHEME (as a noun) ie equity release scheme means. A large scale plot or arrangement for attaining some particular object or putting a particular idea into effect. A secret or underhand plan or plot. Make plans, especially in a devious way or with intent to do something illegal or dishonest. Example “It sounds like just another crazy money making scheme”. I am not sure what the Spanish definition is but does this sound familiar. No wonder the banks are trying to distance themselves from the word “Scheme”. As the saying goes “there is no point trying to close the stable door after the horse has bolted”.