Some wealth management firms outside the US may be turning down American expat clients due to their being seen as a compliance nightmare but as far as UK-headquartered Vestra Wealth goes, this is a customer segment worth catering to.
Some wealth management firms outside the US may be turning
down American expat clients due to their being seen as a compliance nightmare but
as far as UK-headquartered Vestra Wealth goes, this is a customer segment worth
Last week, the firm – set up almost five years ago by former
UBS senior manager David Scott and other colleagues – announced it was creating
Vestra US Wealth Management, designed specifically for US clients facing the
kind of complex tax and financial issues raised by the recently-enacted FATCA
FATCA – or Foreign Account Tax Compliance Act – is taking
effect over the next few years, forcing foreign financial institutions to
report to the US Internal Revenue Service about US clients, a move designed to
combat offshore tax evasion. FFIs that do not show they are compliant with
these new rules face a 30 per cent withholding tax.
Already, some big firms, such as HSBC and Deutsche Bank,
have reportedly closed the doors on US expats and Green Card holders, and a
number of other businesses have told this publication they are wary of doing
business with US clients because of the compliance issue. Vestra, however,
considers the expat market an opportunity.
"The primary reason for the setting up this new service
was that we felt a lot of US citizens were not getting joined up advice. The
problem is that people were getting advice about tax and other related UK/US
issues from their accountants and lawyers but the investment products did not
necessarily fit with the requirements that were set out,” Scott told WealthBriefing in an interview.
"There was a gap in the marketplace for someone who
could understand the investment as well as the tax and reporting sides,” he