The IFA/non-resident expat business is far from a myth, my history on this point is as follows:

My long standing IFA sold his business to a larger firm of IFA's who initially said they would continue to manage my pension fund, two years later when I asked them a question they claim to have never heard of me or of my pension! When I sent them details of our two year old chat their Compliance Officer wrote to me saying they could no longer accept me as a client and would refund my fees for the past two years - I recognised the opportunity to sue for damages but decided to pass in favour of getting on with things.

I then went in search of a new IFA, predominantly using the Unbiased website and through this I contacted over thirty IFA's and asked if they would review and manage my pension, all declined based on where I live. I then contacted the FCA to determine the official UK rules governing this subject and Chris Woolward, FCA Director of Strategy, undertook to review the matter. He came back to me some weeks later stating there are no official rules that prohibit UK based IFA's from acting on behalf of non-resident citizens although he believed two issues would dominate. The first was the need for UK IFA's to be passported into the territory where the client lives in order to understand local tax regulations, Chris imagined there would be few if any UK based IFA's passported into Thailand since for obvious reasons. The second issue concerned liability insurance which was indeed fed back to me by some IFA's during my search, simply, insurance coverage would not extend to clients living in Thailand.

My next step was to contact Baroness Altman or Roz to her mates and she was very helpful, the good Baroness confirmed what Chris Woolard had said previously. Ros. came me details of a firm of IFA's on the DWP register based in St James (there's a name clue there) and they said they would act for me but only using their freelance IFA's who live offshore in Europe, as such the advice would not be covered by FCA rules and there would be no indemnity coverage.

Finally, I did find one IFA purely by chance who said he would act for me although he said he would me regard me as an offshore private client thus our relationship would be governed by different rules to onshore clients, namely none! After getting him signed on to the Transact platform and beginning to pay him monthly commissions, he concluded I should sell everything and buy a single fund of funds that he recommended that would cost me 5% up front and 1.2% per year thereafter, on top of platform fees and his 0.45% IFA fee - we parted company the same day.

I do believe it is possible to enter into an IFA relationship with an onshore IFA but choice is going to be severely restricted and there will be no onshore protection via FCA rules or indemnity coverage, fees are also like to be more extreme than those available to onshore clients, the sum total of which thus making the arrangements infeasible. Having said all of that, I remain willing to explore new possibilities in the hope I may be pleasantly surprised, the last time I tried to do that was via Hargreaves Lansdowne who told me, the computer says no!


"An interesting situation and I am not sure of the reason, so will see if I can make any inquiries. Have you tried many IFA firms and all say the same? If so, it may be to do with their professional indemnity insurance coverage.

Ros"


"Thank you for your email. I have asked Ewan Nicholas (copied) to look into this and provide you with a substantive reply.



Yours sincerely

Christopher Woolard"

Having had an offline chat with rgs on this subject it's now clear that his broker is an execution-only service rather than an IFA and there's a huge difference. Execution only simply buys and sells based on a client instruction and offers no advice as to what should be bought and sold. An IFA on the other hand is an Independent Financial Advisor who offers individual financial advice and is governed by Financial Services Association (FSA) and Financial Conduct Authority (FCA) rules and these can be onerous, to say the least. IFA's are the financial services interface with the public and they deal in a host of financial related products including pensions, mortgages, inheritance, insurance as well as investments. Not all IFA's deal in all those things and many are accredited and specialize in different areas hence finding an IFA appropriate to a person's needs is more than just finding any old IFA. IFA's are also very closely regulated in terms of how and where they can work plus their insurance and reporting requirements are quite stringent. As said earlier, IFA advice is deemed to be governed by the law in the location where it is received. That means a UK based IFA who gives investment advice to a client in say Thailand is governed by relevant Thai law which may be more onerous than UK law on this subject or even none existent, both options having real risk from an indemnity insurance perspective - I believe that people offering financial advice in Thailand are supposed to be registered at Level 4 with the SEC licensing authority which of course requires a work permit, or in the case of existing UK based firms of IFA's, passporting certification which allows them to operate here - passporting ensures the IFA fully understands the taxation regime of the host country. I think it's safe to presume that no UK based IFA is registered with the Thai. SEC and that no UK firm of IFA's has passporting rights into Thailand, although Fletch is in a position to be more precise on this point. Firms such as Aberdeen are Thai companies (51%) that are registered with the SEC at Level 4 so they are legal from a Thai perspective but their advice is likely to be tied to Aberdeen products plus they are regulated by the SEC, not the FSA/FCA.

The bottom line on all of this: if, as an expat, you want to execute investment trades in the UK, buy and sell stocks, shares and funds, finding a broker to do those things is not straight forward or easy but it is possible, as rgs has said. Finding an IFA to provide advice is also possible but is a potential minefield and it is far from straightforward. Firstly, you're looking for an IFA who deals in the aspect of advice that you need help with, secondly, you need someone willing to take you on as a client who is willing to ignore the indemnity insurance and passporting issues relative to Thailand. If you manage to find a UK based IFA who meets those requirements you should then understand that any advice they give you is not regulated and there is no relevant indemnity insurance coverage, the amount of money they charge you is also likely to be different from the UK norm - from experience such IFA's represent less than 1% of the market.


www.sec.or.th/EN/MarketProfessionals/Intermediaries/Pages/sec_license.aspx

Some of the reasons for investing from within Thailand include these sort of issues.

For myself, I have the experience to look around and find options in different countries. However, for my wife and kids if something happened to me, having investments in Thailand and people they could go to for help and advice in my absence is an important factor. Sometimes the range or quality of investments isn't there in Thailand, but the convenience, ease of admin, and future are important factors.

For my mum and brother and his family in contrast I use HL to manage their investments. They are Brits and UK based and unlikely to change. If anything happens to me and they did want advice, they could get it in the UK, and from HL if need be. For my wife and family here if anything happens to me they can likewise go to TMB, Tisco, Aberdeen, UOB and the likes and get help in Thailand.

Where it gets difficult is areas like UK nationals living in Thailand, who need help with their investments. That can be a minefield. Living in one country but getting advice from another jurisdiction (as opposed to just execution)

I know AyG also manages a portfolio of UK investment trusts for an elderly lady on an offshore platform here as he doesn't like many of the Thai based investments. That probably works very well for her, having someone like AyG who she knows and trusts. The problem for her though is what happens if something happens to AyG? If he's no longer around who can/ does this elderly lady turn to for advice as a non-Thai living in Thailand? Would be interested in what the plan might be there, as it's perhaps another option?

In the context of the OP's remark at the outset, "Dipsels the old myth about UK ifas not touching expats", I think it's very important that people reading this understand the difference between the two entities because there is no myth, just a rude awakening for the expat who tries to engage and onshore IFA :

Semantics does not play a role in the differences between execution (brokerage) and advice (IFA), at the consumer level they are two very different and very clearly delineated roles that do not overlap and separate accreditation is required to operate in either role - an advisor cannot execute and a broker cannot advise, UNLESS the broker holds IFA certification also. Most commonly in the UK an IFA will have a relationship with a broker for the execution stage and/or the broker will allocate clients into execution or execution and advice groupings, IFA's however rarely execute as their primary function, otherwise, they are brokers and not IFA's. Firms such as HL combine the IFA and brokerage functions into a single face to the customer although clients are free to pick which of the options they require.

In truth I don't have first hand experience of HL since as a non-resident expat they will not allow me access to either the brokerage or the IFA sides of their business, but I can easily believe they are most likely tied in some way rather than full market IFA's.