1. UK IFA
    June 19, 2019 @ 9:04 am

    I had always associated death bonds with viatical settlement, synonymous with failed funds like Shepherds and Managing Partners Capital and EEA.

    I find it incredible that upfront commissions are taken with the obligatory charging period that stuffs the investor for up to 10 years. I would agree, there is little incentive to provide advice after the sale if 8 to 10% is paid up front and cannot be clawed back by the insurance provider.

    What I find pretty low, is that one of the companies that you mention offers a UK RDR compliant no commission product via its regulated UK company but only for those living in the UK who work with FCA regulated advisers. At the same time, they provide the non-UK investors with a more expensive product just to fund the commission of the salesman via their Isle of Man company.

    I cannot comment on the legality of the sale of these products in Spain but I would suggest that anyone that is recommended such a product asks for evidence that the product is regulated for sale in the EU. One of the firms mentioned is based in the Caymans and others are in the Isle of Man. As I understand it, the firm based in Luxembourg is actually only sold by one “IFA” company in the EU as actual IFAs cannot get a contract to offer their products.


    • Angie
      June 19, 2019 @ 10:34 am

      Correct on all counts. And now that it is confirmed by the Spanish insurance regulator that the way these products are sold is illegal, there will be prosecutions. If these bonds were sold legally – and the brokers/introducers were fully transparent and upfront about how they work and how much they cost (and what the many downsides are) nobody in their right mind would ever agree to having one. But that is assuming the consumer knows he has a choice – most of the brokers/introducers/salesmen tell their clients there isn’t a choice and that the investor “must” have one. That is part of the fraud.


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