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Independent Wealth Management Forum 2019 HK - Exclusive Insights - James Russell

James Russell of Equiom Group

Oct 28, 2019

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1. Are clients too dependent on complicated structures? Too dependent on BVI structures? What are the options they should consider?

Video transcript

1. Are clients too dependent on complicated structures? Too dependent on BVI structures? What are the options they should consider?

The market here is traditionally, perhaps, too much driven by price and I think what really drives clients to simplified structures first and foremost is “is it cheaper to do it this way?” There are other factors that are impacting on this. Global transparency makes it very difficult for clients that have very complex structures to explain them in a way that doesn't make it look like they're doing something they shouldn't be, which in most cases they're not. Also, banking is a challenge and several people have picked up today on the fact that if you've got an overly complex structure, it's difficult to bank. I think there's a risk in over-simplifying. This part of the world has a habit of going to BVI companies as their first option for everything. I'm not sure in every case it's the best scenario for a client. I think in some cases it's down to us, as advisors, to basically, to point out the potential flaws in using a BVI company as a very simplistic structure for anything that they're holding. There are other options, and today we've discussed some of the other jurisdictions that are increasingly prevalent in this part of the world, the old British crown dependencies. We're seeing structures being set up all over the place, and in many cases, those have advantages.

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