Spanish Equity Release Fiasco

For Nordea, equity release risk was to be assesed by reference to the state of the waters you were going to swim in. If you preferred rough waters, you were in for a bumpy ride but if you were rather more cautious with your life-time savings, then your preference naturally would be calm waters, as in the blurred photo.

Well, no sooner than the product was signed up, the calm waters soon turned into a shockingly brutal storm where losses have reportedly reached 50% of the sums invested.

Excellent quantification of risk!

Documents

• Nordea-Risk-Quantification (PDF)

Antonio Flores Uncategorized Equity Release, Nordea Bank

Page 27 of the brochure Guide to Wealth and Tax Planning in Spain gives us some clues of extreme deceit. Not only it openly vindicates the evasion of Spanish taxes by elaborating on specific tax concepts, but this essay also contains suspicious omissions that, if known, would have made a potential subscriber of the product pull out.  The most crucial omission is contained a Spanish tax provision quoted on page 27, top right, which reads: 

“ non-residents tax payers are only liable on the basis of assets located in Spain (or rights acquired by virtue of inheritance or donation), or where the life insurance policy has been established through a Spanish insurance company.”

This quote is inspired on article 7 of the Spanish Inheritance and Gift Tax Act, which says the above but also, the following: “or where the life insurance has been established by foreign insurance entities operating in Spain”.

Which clearly leads us to conclude that Nordea consciously omitted a crucial bit of information that, if inserted, would have made the whole proposal of Equity Release fall by the wayside and thus, the brochure would have not existed. If all of those who signed with Nordea had been given the benefit of objective and transparent tax information, rather than deliberately manipulated, they would have not been saddled with these obnoxious products. Unfortunately, they were lied to.

Article 282 of the Spanish Penal Code stipulates: “manufacturers or traders that, when advertising products and services, make false or untrue statements about the same, capable of causing serious damage to customers, will serve a minimum of 6 and a maximum of 12 months imprisonment.”

 Documents

• Nordea-Brochure (PDF ~800 kb)

Antonio Flores Uncategorized Equity Release, Equity Release Victims Association, Inheritance tax Spain, Nordea, Nordea Bank

When the Equity Release providers chose to roam the Spanish Costas and hired imposter IFAs, they seriously hampered their ability to lend in a massive scale for their scope was, from the outset, limited to the tourist areas. Because having hundreds of millions to lend, perhaps billions, to unsuspecting pensioners who were looking at maitaining their wealth, I would have thought that a full on marketing campaign was de rigeur, via Spanish national television, media outlets etc.

Surely, the following pitch would have made tens of thousands of pensioners to latch on to the Tax-Evading-Equity-Release-Programme:

Advertiser:

Dear Spanish Pensioner, this message is for you and if you don’t listen carefully, you may be in trouble: Do you own a property?…Do you not have a mortgage on it?…Do you not realize that your property and family wealth is in danger if you don’t to something?…Because the Spanish Inland Revenue is here to rob you…Take out a mortgage loan on your property, no matter your age or size of your pension, have a guaranteed income AND dodge the Inland Revenue…Or do nothing in terms of IHT planning and make the tax man’s life easier, make them a member of family and allow them to run away with your hard-earned income.” (non-bold text extracted from publicity used by agents employed by Rothschild and Nordea Bank).

One can only imagine the hundreds of millions of Euros these banks, imposter IFAs, Lawyers, Notary Publics and incompetent tax-haven-fund-managers, could have reaped if this ad would have on say, Antena 3, Telecinco, Canal Sur, or perhaps the BBC…and it will stay in our imagination because had this scaremongering message been divulged on Spanish media outlets, live-broadcasted breaking-news showing scores of pinstriped-suited individuals being thrown into police vans would had been almost guaranteed.

Yet still they managed to run off to Luxembourg with a few good number of millions of expat money.

Downloads

• Lawbird-Rothschild-Marketing-Literature-Court-Evidence (PDF)

Antonio Flores Uncategorized Danske Bank, Equity Release, Hamiltons Financial Services, Henry Woods, Luxembourg, Nordea Bank, Rothschild

It was a few days ago when I was asked by a victim of Nordea’s equity release scheme in Spain, in a mood of disbelief, whether it was possible for a bank of that stature to have got it so wrong as, after all, they had plenty of money to pay for the best advice from top lawyers.

I could bring an argument against his comment relating to having plenty of money, some of it belonging to their clients-turned-victims, and the advice that this money could buy but, on their own, those fresh memories of very large banks going bust for hanky-panky practices allowed to happen by their advisors, would answer the question.

And then, by coincidence, I read on the Danish press (Copenhagen Post Online) that a few days ago the Danish Financial Services Authoriy had reported Nordea to the police for failing to make a full disclosure in relation to a jewelley firm.

http://www.cphpost.dk/business/business/51997-fsa-reports-nordea-to-police.html

Well, soon enough they will be reported to the Spanish authorities via the criminal courts for miselling financial products on the back of a bening pensioner-friendly equity release programme that was supposed to be the panacea to dodge, “legally”, inheritance and wealth taxes in Spain, all-in-one.

This financial herb-allheal to cure British homeowners from inescapable taxes has morphed into a thorn apple plant of undefined toxicity that is now like an albatross around their necks.

Antonio Flores Uncategorized Equity Release, Equity Release Victims Association, Inheritance tax Spain, Nordea Bank, Wealth Tax Spain