Please, I was barraged by phone calls on my private cell phone number within 2 weeks of getting out of Beijing Airport by cold callers asking to set-up meetings with 'advisors' flogging these scams. After examing the products, which would have basically ruined me, then discussing these plans with my colleagues, its little wonder the products have to be marketed so aggressively. I can only imagine how these salespeople peddle on the naivety of young family-oriented expats.
Besides, we aren't talking about peanuts here Lucik, we are talking about people's financial futures, along with their loved ones financial futures. There is a reason it take several years to get a FA license in Australia, Lucik, as there are myriad professional, ethical, and regulatory responsibilities. NONE of these responsibilities exist here in mainland China. If you truly did work in this industry, I don't know how you can even begin to defend these scams.
Besides, just a quick google search shows that the web is over-run by sad tales of expats being scammed by these offshore savings accounts offered by "advisors..."
For example:
"My worst investment was with Friends Provident Premier Flexible Saving Plan, I was misled by an advisor based in Thailand into thinking it was a straighforward lump sum investment, it was not. The charges and exit penalties on the initial units are so high that I will be very lucky to get back one third of my investment.
"You don?t say how much you are putting into the Friends Provident Premier plan but if you have a look at the policy terms and conditions you will note that 1.5% per quarter (6% in year one right? Plus another 3% in year two, so 9% total) is payable on the contributions you made during the first 18 months BUT it is paid every year on these contributions throughout the entire term of the plan. All 25 years in your case. Let's assume for easy working that was $1000 a month = 18000 x 9% = $1620 per annum X 25 years = 40,500
Additionally you have the 1.2% pa which is on the mirror funds. A mirror fund is basically a life company fund which invests in the underlying fund of the same name run by the managers of say Thames River Capital, Baring, Investec etc. Those underlying funds also have an annual management fee and so you are effectively giving your money to a life company and paying them dearly for the benefit of them passing your money on to a fund management company. Those underlying fund fees may be 1.5% pa or they can be higher, 2% is not uncommon, and you have to add this to the 1.2% pa. So assume that the underlying fund has an annual management charge of 1.5% then you?ll be paying a total of 2.7% in addition to the annual drag on your performance from the initial charge of 9%. The reduction in yield caused by this may not look much now, but this is like heading for the North Pole and starting off a yard off course. By the time you are well down the road you are off course.
Should you wish to get out of this plan at all then I would draw your attention to first paragraph 1.10 of the Policy Provisions which basically says if you stop, after 90 days we?ll make it paid up, but the fees continue whether you pay in or not."
"It doesn't matter whether the sum is 450, 4500 or 45,000, you have paid for 15 months out of a possible 240 i.e. 6.25%. These are terrible products and you can almost certainly do better elsewhere. Cut your losses and get out now. As previously mentioned, the stock market should present very good returns over 20 years particularly from these levels, Past experiance would suggest that you would recoup your money and then some."
I signed up for a 25-year Generali Vision life insurance policy, paying in a lump sum each month. This was what he recommended as a flexible investment which would allow the money to grow and leave me with a large sum on retirement. After receiving the policy documents, however, I was puzzled by apparent contradictions with what he had said, and was able to confirm by phoning Generali that the investment was not flexible (e.g. multiple payment holidays were not allowed, as the adviser had claimed, and even one payment holiday was not guaranteed) and would take a number of years to show any growth...
