Financial adviser Frank Furness says:

 “For me, it’s the best job in the world. Where else can I go out and meet somebody, drink their coffee, eat their cake, and walk out with $5,000 in my pocket? No other business.”

Furness has made a living out of showing financial advisers in Asia how to make the ‘coffee chats’ more than pay for themselves - at your vast expense. Parts of the system in Asia, the UAE, Dubai and beyond are weighted towards the financial advisers. And they are growing richer from fees from your savings. Furness and his colleagues have even been captured on video boasting about how much money they can make for themselves by focusing on the expat market

Jason Butler, in a Financial Times article entitled ‘British expats, your financial adviser may well be a bandit’, provides a scathing summary of the Asia financial adviser landscape: “As for an obligation to give the client suitable advice, forget it. In the world of lightly regulated retail financial services, anything goes. There is systematic, widespread and damaging mis-selling being carried out by overseas financial advisers.”

How are they getting away with it and what can we do to protect ourselves and our savings?


In my experience, here’s how it tends to work.

You get cold called by one of the expat finance specialists, who meet with you for coffee on a number of occasions.  You discuss your future pension needs and back-work how much you need to save each month to reach that goal.  All sounds good so far – and I encourage everyone to do this themselves.

Your ‘Independent’ Financial Advisor (IFA) recommends setting up a regular saving account that you pay into for 20+ years.  You earn a good salary and know that you should do something sensible with your money, especially if you plan to head home in the next 2-5 years.  

So you agree, sign the paperwork, and walk away with a warm, and slightly smug, feeling that you finally sorted your long-term pension out, and you have a team of experts working on your behalf to invest your money in top funds.  You’ve gone from a finance featherbrain to Gordon Gecko in just a few weeks.


What you’ve probably just set up is some sort of offshore product that will heavily penalise you if you try to take your money out. These products pay substantial commissions to your advisor (well, you didn’t think the coffee was really free, did you?).

Firstly you’ll be paying an annual fee for the running of the product. This can be around 1.2% of the total money you handed over.

Often there is an initial period where you are charged an additional 1% - 1.5% annually – this could be for the first 5 years.

Next, the funds that your team of experts have handpicked for you will charge an annual fee.  This can be between 1% - 4% of your total money invested.

So, in total, you can be paying 3% - 7% annually for your new investment set up.  Compare this to the cost of doing it yourself which should be lower than 0.5%, or a more reputable low-fee IFA which can do this for less than 1.5%.  

Lastly, those out-performing funds that have been especially selected for you?  There is a 99% chance that they will perform worse than similar low-cost trackers that you could have picked yourself.


A percentage here and there - doesn’t make that much difference, does it? Your IFA might of just taken over half of your pension pot compared to doing it yourself.  Bottom line – fees matter.

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If you save $2k per month for 30 years and get an average return of 7%, you end up with $2.2m in your account if you manage your own long term savings compared to $930k if you hand the reigns to an IFA.  In retirement thats a life changing amount.


Since the end of 2012, UK firms have been required to charge explicit fees for their services, rather than be remunerated by commission from investment products and providers, which is common in Asia. This avoids the temptation to recommend products that pay the most commission to the advisor, rather than whats best for the client.

Butler points out that between 2011 and 2012 the number of UK authorised financial advisers fell from 40,500 to just over 31,000 and it’s likely that a significant number of advisers left the UK to avoid the new regulations and work among British expatriate communities in Asia, Dubai, and UAE, or where there are large communities of retired Brits such as Portugal and Spain.

“While all of these expat destinations have some sort of financial regulator, the rules and standards for selling retail financial products to foreign residents are laughable compared to those in the UK. Eye-wateringly expensive financial products, laced with enormous commission payments to financial salespeople, are the norm.”

As a benchmark, the FCA recently published figures suggesting that in the UK you should expect to pay around 3% upfront for advice, and then a yearly retainer of 0.5%.  Add to this any fees from the individual funds and you should still be paying less than 1% in total.  For example, on an investment of £100,000, advice fees would cost £3,000 initially and £1,000 annually thereafter, rising or falling in line with the portfolio’s performance.


An IFA might also recommend that you move any existing UK pensions to an offshore bond “wrapper” to improve tax efficentcy. This is very lucrative for the IFA as the typical initial charge for this transfer is 15% of the value of the pension with ongoing charges of around 4% per year (2% for the wrapper, and 2% for the underlying investment products).

Butler provides the following example to demonstrate how this transfer can set your long-term saving back years:  “A £500,000 pension transfer therefore becomes £425,000 after deducting the set-up costs and commission. It then incurs total annual costs of about £20,000 a year (as this is based on the transfer value before initial charge) before the investor gets a look in. Even with post-cost returns of 1 per cent annually, it would take nearly 17 years for the fund just to grow back to £500,000.”

In response to the rising number of pension transfer scams aimed at expats, the FCA issued an alert in January 2017, specifically aimed at the UAE.  This is after the UAE’s Insurance Authority highlighted “an alarming amount of complaints” from policyholders.  There have been similar moves in Qatar, Singapore, South Africa, Hong Kong, Poland and India.


If you are currently an expat, then my advice is to hold off on attending any more coffee chats until you’ve done some research of your own.  Sorting your finances out should still be at the top of your list – this is not an excuse for inaction! 

A good first step to is read Andrew Hallam’s "The Global Expatriate’s Guide To Investing” and decide if you are comfortable with the DIY approach, otherwise, try to find a credible adviser that will operate on a fee-only basis. Of course, not all IFAs operate like this and Andrew maintains a list of reputable advisers on his website.

Being fully aware of the impact that fees and charges will have on your long-term savings could make all the difference when it comes to old age. Please take responsibility to understand what you are agreeing to.

UPDATE SEPT 2017: Since publishing this article in February,  I have met with several  financial advisors in the region who do not operate like this and have their clients best interests at heart. I often refer my 'Financial Clarity' coaching clients to them. If you would like their contact details, then please get in touch. Email me:

Note on fees: fees are highly variable between different advisers and products, and therefore will vary to those referenced in this article.  I have tried to give a fair representation of common expat products, specifically from providers such as Friends Provident and Zurich.