British residents in Cyprus are prey to unscrupulous financial advisers peddling high-risk investment that they lack the expertise or license to be offering.
Cyprus’ large expatriate community is continuing to be targeted by several unlicensed and unregulated international financial advisory companies, the CEO of a local wealth management company has warned.
Woodbrook Group Chief Executive Michael Doherty said his main concern was to raise awareness, so people ask the right questions to those offering them something that sounds too good to be true.
He believes more expatriates may unwittingly be risking their savings because they are receiving advice from unregulated consultants.
“People lose pensions because they are fooled by unlicensed practitioners, we want to make sure people are getting proper advice,” Doherty told the Financial Mirror.
He said the issue was one of making people aware and not self-promotion for his company.
“We need check and balances…these guys are misselling because there are no checks on what they are selling.
“We are not saying give business to us, but we are saying clients should know what they can and can’t buy and know what the risks are,” said Doherty.
He said people are “selling what they like and then leaving”.
Woodbrook estimates that thousands of ex-pats, mainly British nationals, have been badly burned in the past by unregulated and unlicensed operators who sank their savings and pensions into high-risk investments without their clients’ knowledge.
It says several international financial advisory firms on the island are continuing to target expatriates without having a proper license.
“Many of these companies are regulated by the Cyprus Insurance Company Control Service (ICCS) but are offering services that are not covered by their license, including advising on underlying investments on insurance bonds,” said a statement by the group.
Doherty urged expatriates to be extra-vigilant and to ask their financial consultants some basic but important questions to ensure they are dealing with a fully regulated and compliant company.
“This happens all over Europe, it’s bad in Cyprus but not worse than any other country,” said Doherty.
“A majority of expats have a sour taste from people in the past and I know companies that are doing it,” he added.
