Tag archives for Capital Assurance

Conversation between DANSKE BANK INTERNATIONAL and Son of a Victim

Søren Glente

This conversation was taped by the son of a Danske Bank International S.A. victim, and Soren Glente, at the time one of the bosses in charge of selling the Capital Assurance. The conversation had already been postedin this site but now, we have the most relevant parts in writing.

In the recording Mr. Glente, a classic Luxembourg-based Danish banker, has a rare fit of honesty and sings like a canary: 


Minute 15:00 onwards

S.B.: How would you describe the risks of this product?

Soren Glente: Well ehhh depending on how aggressive the client would like to be then, I mean if you did it only for the purpose of optimize your tax situation. Then the risk is quite small, it will cost you something each year, I mean the difference between what you paid and the interests of the loan and what you could achieve on interests of the       and if these were place cautionally  the income from the assets would be less than what you paid on the loan, and that would be the price of …

S.B.: and was that made clear to the client?

Soren Glente: oh yes sure, for the

S.B.: so the income from the loans, sorry the income from the assets and investment would never cover the loan? Ehh?

Soren Glente: no , if you wanted to have a very cautious investment profile, then you couldn’t you couldn’t have , the income couldn’t achieve the cost of the loan, no. if you wanted to to achieve that on the loan , then you had to be take some kind of risk, like buying more risky assets

S.B.: so it was really ehh

Soren Glente: and so on and so on

S.B.: so in order to be low risk it was loss making

Soren Glente: yes, that’s for sure

S.B.: and loss it was going to accumulate every year

Soren Glente: yes, not by much, but yes, it would, it would accumulate each year because you would be ehh, you would be able to get an income from, let’s say your deposit or your short term bonds which would be ehh, the income would be less than what you paying interests on the loan, so therefore it would accumulate each year, yes it would

S.B.: do you think my clients understood that?

Soren Glente: yes they did, because I explained that to them, when I had meetings with them, I explained them , because I was, when I spoke  with clients ehh or with your parents ehh, they were, in the beginning the investments was very conservative  placed by me in an agreement with them, and then each year they could see that the capital actually degrees value, that the assets couldn’t provide income which would pay the interests of the loan, so therefore they came to me actually and ask whether I, we should consider changing the assets to more risky assets, in order to achieve a higher income, so I had a long dialog with your clients, ohh with your parents  about that, because I had to tell them that if they wanted that, the risk would increase and as far as  I remember we agreed to take a small portions of your parents’ assets and place them in a slightly risky assets, in order to at least break even, that is as far as I remember, but you could see, but you should be able to see that on the notes or… so that’s what happened. So  I remember I had a dialog with your clients, with your parents  in the bank sometime

S.B.: mmm mmm

Soren Glente: but we are going many years back now

S.B.: right, well I think that they did not understand it, I don’t think that they understood that from the beginning when they signed up to this contract, that this was going to run it to loss, if it was going to be lowerer QQ  

Soren Glente: no, you might be right. That they didn’t because, you might be right that they didn’t understand that

S.B.: mmm there were…

Soren Glente:  many many clients on the costa del sol didn’t understand that you can’t just, you can’t you can’t just automatically make money out of the negative equity, which it actually was, without taking risks and that has been the case for many many unfortunate clients down there that they are they have placed assets on too risky assets too risky assets like equities and things that were having a loan on both the house and the assets

S.B.: did you know the others, do you know,   how many other clients did you have like my parents?

Soren Glente: several

Up to minute 20:00


Minute 32:50 onwards

S.B.: and do you still sell this Company insurance scheme product?

Soren Glente: yes, by all means if people they are wanting to tax optimize their situation then that is one of the best schemes you can sell in.it really is

S.B.: but there is dispute about whether it does actually protect against Spanish inheritance tax, not everyone says, not everyone says it protects

Soren Glente: yes, but I have got a legal opinion saying differently

S.B.: from who, may I ask who from?

Soren Glente: it was from several other companies Price Waterhouse Coopers in Spain in Madrid, we have a legal opinion from these guys

Minute 34:03

Soren Glente: Yo have to do it right to have it to work, but it does work, you just have to know that the reason for doing this is not to release your equity from the property to in order to buy a new car or whatever you want to, the reason for doing this is to optimize your situation for wealth tax and yeah mainly inheritance tax, wealth tax was also an issue, but it is a lesser issue today

Tape Recording: How Danske Bank Sold Equity Release in Spain

Søren Glente

When we say that ERVA has first-hand evidence on how Danske Bank International S.A. -based in Luxembourg- sold their diabolical Capital Assurance Equity Relase we are not referring to the fraudulent promotional literature, even if such documentation openly admits to offering a tax evasion product.

Actually, first-hand information means rather from the horses mouth, or more appropriately from Mr. Glente’s mouth, who openly confirms in a telephone recording how the product was sold.

In the conversation, Mr. Glente confirms the following:

  1. The product was ‘for sure’ loss making at low risk but that the inheritance tax benefits outweighed such losses (16’).
  2. Many of clients were not aware that the product was going to run at a loss, that it was in negative equity, “which it actually was” in his words, without taking risks (19′).
  3. The product is currently the best ‘tax avoidance’ product in Spain, and that it has been confirmed by several top firms, PWC included (33’)
  4. Danske Bank International S.A. sold the product in Spain to optimize the situation for Inheritance Tax, and that was the only real benefit.

The couple settled out of Court at a loss of circa €400,000, not before an apology was extracted from them.

Listen to this revealing conversation here, after obtaining clearance from a law firm

(the last 2 minutes of conversation relate to a recording between the owner of the tape and Danske’s lawyer in Fuengirola).

Rothschild: we never provided financial advice

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?


KPMG tells Danske Bank Luxembourg to Stop Using their Name

And so it was, that, in relation to an Equity Release fraud case in Spain against Danske Bank Luxembourg, the defendant held the following:

We conducted our due diligence according to the internal rules and procedures Danske Bank Luxembourg has in place. As part of this process, the Capital Assurance product, sold on the basis of a tax-planning proposition, was fully cleared by KPMG. We therefore reject the claimant’s action for it is groundless, without merit, and we will defend ourselves vigorously.


Fully cleared by KPMG? What does that really mean in Danske Bank Luxembourg banking jargon?

Mr. Klaus Mønsted Pedersen: have you read the attached document by KPMG Madrid, denying that they ever gave the blessing to the cash-predatory tax-evading Capital Assurance Product, ever authorized your company to use their name and in fact, formally requested you to eliminate from the brochure any reference to the product being approved by KPMG?

Danske Bank Luxembourg Capital Assurance: Do Away With Spanish Taxes


Klaus Mønsted Pedersen, Managing Director of Danske Bank International (Luxembourg) and the man behind the products developed to provide efficient cross-border tax-planning seemingly ensured that, prior to launching his state-of-the-art Capital Assurance, a thorough compliance job had been carried out.

To that effect he tied up loose ends, dotted the i’s and crossed the t’s, and attended to detail. Because detail mattered.

And to not leave anything to chance, the website conveys a clear message: that tax benefits adapt to local legislation, and to make sure that there is no mistake, such benefits for Spain are confirmed by no less than a Big Four, KPMG.

Spectacular display of Danish efficiency, in case we had any doubts; and not a chance in hell for those who signed up for the Capital Assurance + Spanish Hipoteca, two air-tight contracts drafted by top law firms that are virtually unbreakable.

Such is life.

Or so we thought…

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