Archives for Legal Action

NORDEA Bank Topping the Dishonest Bank’s List

12th February 2013 by admin under Legal Action     

Nordea Bank Luxembourg must feature top of the list in this imaginary list of indecent foreign banks that once operated, and still do, in Spain. From a tiny office in Marbella, Centro Plaza, they have scammed untold numbers of otherwise happy British (and probably many fellow-nationals) property owners.

This booklet will soon be studied by investigators in tax evasion criminality, scholars and Universities of all over Europe. Across the Atlantic, the US Attorney’s Office in Manhattan is being sent a full dossier of the incriminating paperwork for their consideration, as it appears that Nordea Bank Luxembourg also felt the need to cheat the US Internal Revenue Service.

Rothschild and Landsbanki have packed up, knowing the extent of the damage.

Judicial action will soon catch up with these banks.

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Offending Equity Release to be Scrutinized by the Spanish Tax Office

11th February 2013 by admin under Legal Action     

Lawyers for ERVA have formally requested the Tax Office to provide an opinion on whether the widely publicized and marketed “tax-mitigating mortgage” is, from a tax point of view, a legal option under Spanish laws.

No sooner we get an answer than we will be publishing its content on this site.

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Non-Residents to Pay IHT on Unit-Linked Offered in Spain

7th February 2013 by admin under Legal Action     

A 2002 ruling states it clearly: where an insurance company is offering life insurance in Spain, the beneficiary of the policy is to pay taxes in Spain, whether his status is one of residency or non-residency.

According to the ruling:

Where the policy holder and the beneficiary of the policy are different persons, any payments made under the policy will pay Spanish IHT, irrespective of whether the beneficiary is a tax resident in Spain, or not, pursuant to the provision of Act 29/1987 of the 18th of December and the Royal Decree 1629/1991, of the 8th of November, which approves the Inheritance Tax Regulation.

Of course, it was not in the interest of Lex Life, Nordea Life and Pensions, Jyske Bank etc. to tell people the truth, was it?

How best to further your business in this country by cheating foreign property owners, hey?

At least, you did study carefully and took into account the legendary Spanish laid-backness, we’ll give you that, but for sure, this scam will soon be properly picked up…!

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Sydbank’s Offer To Settle Turned Down

4th February 2013 by admin under Legal Action     

Undeterred by the scandal that hit the press in Denmark 1 year ago which meant, among other things, the closing down of Sydbank Switzerland (to presumably prevent further reputational damage), Sydbank Denmark’s lawyers in Spain are still convinced their customer did nothing wrong and so, have offered a meagre 40% of the portfolio losses to their victims/customers, leaving out of the base to calculate compensation mortgage payments, costs, legal fees etc.

Naturally, the offer was promptly rejected.

Let’s remember what this bank did during its very short, yet extremely damaging time in Spain, which those lawyers consider to be “acceptable”:

  • Opened an office in Fuengirola without letting the Bank of Spain know.
  • Offered British customers a perfectly sound and legal Inheritance tax “avoidance” scheme, in partnership with Nykredit, whereby unencumbered properties would be mortgaged with a loan offered by the latter, the proceeds being dispatched to a Swiss account held by a Belize-based offshore company, all of it devised, arranged and managed by the former.
  • Used an unregulated IFA based on the Coast.

At the same time, the lawyers:

  • Denied having offered an Equity Release Scheme with Nykredit.
  • Denied any relationship with Nykredit, alleging that it was the borrower who contacted both, separately.
  • Denied having had a contract with any IFA on the Coast, blaming the customers for “hiring” the IFA.
  • Confirmed that if Inheritance Tax was the purpose of the contract, it would have been the customer’s motivation and not the bank’s.
  • …
  • …
  • …Denied that the earth was round

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Rothschild: we never provided financial advice

3rd February 2013 by admin under Legal Action     

One of the many excuses Rothschild put forward to excuse themselves of any wrongoing (and they have a case ready of excuses, just in case!) was that, when shamefully selling the nefarious CreditSelect loan (the mortgage loan which should not be seen as one thanks to “Rothschild conservative approach”), they never provided financial advice. 

The reality is different: Rothschild not only provided tons of financial advice (abundancy of literature proves this), they actually selected the funds where the monies were to be invested in and there was no compromising in this.

For the pensioners, there was no reason to distrust their set up, as they put it:

Thanks to Rothschild’s conservative approach, clients will not be exposed to unnecesary risks

Mike Atherton has a very interesting column in the Money Section of The Times and very much line with the above, wrote an article yesterday (2/2/2013) titled When advice is not advice.

 

One of my Times Money colleagues recently sat in on a consultation her mother had with a mortgage expert. Strictly speaking, the expert was not offering advice but “information” about mortgages. However, as the conversation ranged over different mortgage products and her mother’s available options, my colleague could not help feeling that, whatever the official label, this felt more like advice than simple information.

 

This blurring of the distinction between information and advice is not confined to the mortgage market. The entire financial services industry is full of grey areas where consumers may think they are receiving one thing, when in fact what they are officially being given is something rather different.

 

The problem is especially acute in the investment world. Over the past 20 years a range of execution-only intermediaries, including discount brokers and investment platforms, has sprung up to offer investors a vast amount of information and research, but not advice.

 

They are competing for business with financial advisers, who, as the name implies, do give advice, as well as offering access to research and financial data.

 

So you have advisers on the one hand and intermediaries on the other, both helping investors with their investment choices and both offering them the benefits of their research and analysis. Investors could be forgiven for failing to spot the difference.

 

But the distinction is important because investors should be crystal clear about whether they are receiving financial advice or not. If they mistakenly think they are, they could be lulled into a false sense of security about the appropriateness of the product they are buying.

 

Some financial advisers suspect that their execution-only only rivals have not exactly been unhappy about the blurring of distinctions. The more cynical point to the many cases where intermediaries have drawn up lists of their preferred funds, or produced glossy booklets highlighting a small number of carefully selected funds, while making no mention of the rest.

 

What, the cynics ask, does this represent, if not a recommendation to buy certain funds and ignore others? The intermediaries would respond that they always issue a clear disclaimer that none of the information they provide should be construed as amounting to a recommendation or advice. But the cynics say that if it looks like advice, sounds like advice and feels like advice, investors are going to consider that it is advice.

Does anyone still believe today that Rothschild did not provided financial advice?

How much longer can they persist in pursuing this grand larceny?

 

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Contracts Used to Evade Taxes Declared Void

28th January 2013 by admin under Legal Action, Uncategorized     

Several Spanish Courts are already ahead of the game on using contractual artifices to evade taxes, pretty much what the Equity Release was all about. The chief difference between both setups is that whilst the ones already set aside were mutually agreed on the understanding that it was illegal to do so, on the Equity Release banks lied as to the legality of the matter and misrepresented the truth.

As Nordea put it

We offered you advice which we thought was correct at the time of publication. It was however your prerrogative to go elsewhere to obtain correct advice…(!)

In contrast to Nordea’s clever plan, Madrid-based National Audience said the following about contracts used to avoid Capital Gains Tax:

It is reasonable to presume that the profuse and complex series of contracts carried out by the parties answered to a fiscal strategy and, in reality, had no other purpose than to evade taxes…In summary, the object of each of the contracts agreed to was unconnected from the real economical nature that they are intended for, and were rather used seek tax avoidance, once the contracts were succesfully implemented, on the gains derived from the main agreement.

The Superior Court in Navarra established that:

No juridical contract can enjoy this status if it is intended to attain a tax advantage, because no tax advantage can be transferred between the parties, and thus such contract produces no effect in respect of third parties…what has been confirmed is a surreptitious avoidance of taxes which none of that parties were entited, directly or indirectly, to legally avoid.

And more recently, on the 2nd of February 2012, th Supreme Court in Madrid endorsed all prior judicial opinion on the matter by ratifying that:

We must conclude  by asserting the illicit nature of the object of the contract insofar as the aim pursued by the parties was an illegal and immoral business common to both…exemption and tax advatange…without any of the parties being entitled to it.

If the contracts are not valid, there is no question of them being set aside and damages being awarded…for they never existed.

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Courts Voids Mortgage Loan Due to High Complexity

24th January 2013 by admin under Legal Action     

The mortgage loan referred to, tagged as “highly speculative” by the Court, was declared void due to the bank not having advised the parties of the real risks.

The Court concluded that the bank was under the obligation to provide clear, transparent and adequate information in respect to the product, but failed to do so. At the most, according to the ruling, the bank offered “verbal advice”, which was then considered to be “…not consistent with a statutory mandate to provide a precise and clear explanation of the risks associated to the product”.

The ruling insists on the uncontested fact that Caixa Catalunya glossed over certain keys aspects of the risks of currency exchange rates and interest rates, and the impact this could have on the mortgage.

Which takes us to the following questions:

  • How would this Court view Nordea Bank Luxembourg’s “Home Sweet Home” pre-contractual information package?
  • And what about Rothschild’s “conservative approach” or rather, the “mortgage that would not be looked upon as one?”

VoidMortgageAppealCourtBarcelona

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BFI Consulting, Swiss Life, Nordea Bank Luxembourg and…Allan Graydon!

19th January 2013 by admin under Legal Action     

SwissChoices is about Swiss Quality. And that is how it will be delivered to SwissChoices clients.

At ERVA, we often visualize Allan Graydon sitting at his kitchen table, in his underpants, thinking about how to drive new business in, and, upon coming up with new brilliant ideas, dialling one of the following numbers:

  • Nordea Bank (Luxembourg) S.A. Jhon Mortensen
  • Peter and Jane, caught up in the Landsbanki scam, asking for €500 to negotiate with infamous Yvette Hamilius.
  • BFI Consulting Frank R. Suess
  • Swiss Life Ivo Furrer
  • Mercadona Calahonda home delivery service.
  • Spririt Hairdressing and Beaty Salon, Nueva Andalucia
  • Norman Steele, long-standing pal and former partner, who fell foul of some national authorities for fraud.
  • Morten Remo Sorensen, current partner fined by the Spanish financial regulator (CNMV) for illegally offering financial investment services on behalf of consumers.

SwissChoicesEquityReleaseBrochure

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Experienced investor funds-buyers beware!

16th January 2013 by admin under Legal Action     

Mark Davis, from Brooks Macdonald Asset Management, warned pensioners back in 2004 of what he thought was an extremely dangerous scenario:

The situation in Spain however when dealing through unregulated advisers is much like the funds themselves; not subject to any form of regulation or approval and investors are not protected by any statutory compensation arrangements in the event of miss-selling.

The 2004 article did not have the benefit of hindsight nor can now be dismissed as the typical “I knew-it-all-along” rubbish: it was happening there and then but almost no one saw it happening! In fact, we can say that it was all just starting…and still he publicly warned of this very uncomfortable yet dangerous scenario.

Good for you Mark but shame not many people read your piece.

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Nordea Bank Luxembourg Lawyer’s Principles

15th January 2013 by admin under Legal Action     

The attached picture corresponds to Mr. Jesus Pérez de la Cruz Oña, acting lawyer for Nordea

Bank Luxembourg S.A., nothing wrong with that. In fact, his austere expression conveys seriousness and rectitude, qualities that these days are in short supply.

Mr. Pérez Cruz represents a company, Nordea Bank Luxembourg S.A., that produced what is probably the most comprehensive tax-evasion brochure ever to be published by any company, and perhaps the only bank to have done so, so far with little consequences for them. And he defends its content vigorously, for which he gets paid nicely, as a result of his swear-in ceremony, wherever it took place; again, nothing wrong with that.

Let’s remember what Nordea said:

Borrowers may take up a mortgage loan either at the time of the purchase of a Spanish property or after having owned the property for some time….the latter case is more aggresive from a tax point of view and therefore more uncertain…taking up a mortgage loan at a later stage runs the risk of the Spanish authorities questioning the purpose of the mortgage…as this publication was being prepared, mortgaging Spanish property some time after its original acquisition was a matter of some debate in Spain…according to the information the authors had at their disposal at the time of writing, taking up a mortgage at a later stage was still expected to be accepted by the Spanish authorities in future.

Generally speaking, the risk of receiving unwelcome enquiries from the Spanish taxman should only exist in situations where the owner is a non-resident who takes up a mortgage loan with the aim of trying to minimize his/her net wealth tax liability.

But one thing is not right: Mr. Perez Cruz says in his CV that he practiced for prestigious Uria & Menendez, a company that said about these products – before removing the paragraph following a phone call from Rothschild- the following:

It may not be discarded that the Spanish Authorities may try to challenge the deductibility of a loan granted to a non-resident for IHT purpose under the arguments that either (i) the debt has been “simulated” for the exclusive purpose of reducing the Spanish IHT liability or (ii) because the lack of connection of the debt transaction with Spain, the Spanish elements of the debt have been artificially incorporated to the debt…

Groucho Marx: Those are my principles, and if you don’t like them… well, I have others

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