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

Landsbanki has had no qualms over introducing false information on a public deed of mortgage loan, signed in front of a Government appointed Spanish Notary Public. In this instance, the spurious claim was that my clients had been in Luxembourg, on the 20th of February 2026, to sign a contract…

I can live with the 2026 error, unless Landsbanki had a time-machine which nobody knows about (now probably auctioned off to some freak by the bankrupcy administrators), but stating that the signatories to the contract had been in Luxembourg to sign what is an unintelligible contract bodes well for successful Court action, given the utter lack of ethics and moral integrity.

Antonio Flores Uncategorized Equity Release, Icelandic Bank, Landsbanki

The frontispiece of Danske Bank’s vividly shows the state in which my client has been left after having a few drinks, and signing a couple of contracts, with Denmark’s biggest financial entity: “en pelotas“, as they say in Spain (stark naked or high and dry, whichever way you want to interpret the photo).

The article, by Sean O’Hare,  is superbly written and sticks to the points of argument: that Danske offered a product to British expats with a view to make money out of it, on the pretext that IHT would be mitigated and pocket-money would be received by the client, for the investment would yield enough to settle the interest and leave a surplus. As far as inheritance tax was concerned, no such luck could have struck the beneficiaries, for they would have been breaking the laws, and as regards to the pocket money, unfortunately he no longer has trousers to bear pockets to garner any cash, like the Greek Adonis of the frontispiece…

Antonio Flores Uncategorized Danske Bank, Equity Release

The Spanish regulator, the CNMV, has answered a petition on information that was made about 1 month ago. From it, we can conclude that:

1. Danske Bank´s Capital “Assurance” product did not get clearance to be offered to investors based in Spain. We are waiting for an answer from the Insurance regulator (DGS).
2. Nykredit Realkredit is regulated in Spain and obtained clearance to offer a product labelled “Euro-denominated perpetual hybrid core capital notes”. Sydbank, with whom investors signed their contracts, is not.
3. The IFA: no sign of the gentleman although he seems to have clearance to act on behalf of “Caser” Insurance, on an exclusive basis, to offer a number of insurance products. No trace of having authority to sell Danske Bank products. He certainly is not authorized to sell any financial service or product.
4. Rothschild: Registered with the CNMV but need to be more specific although, since they were selling the Aspect Policy, this will be for the DGS to advise on.

• Scanned pdf of the response from spanish regulator to initial enquiry here (400 Kb.)

Antonio Flores Uncategorized Danske Bank, Equity Release, Nykredit, Rothschild, Sydbank