7 June 2011

Are you protected against fraudulent investment advisers?

A report about the loss of Sfr 20 million that has been uncovered in the private banking department at UBS highlights the need to carefully select and monitor investment advisers. In this particular case a senior adviser to very high net Spanish clients had caused the misappropriation and the bank had to reimburse them. So one could say that it pays to entrust only very large and financially strong institutions with the management of one's investments. But there is another way and it means that independent or smaller money managers can well be entrusted with the direction of the investment but that the safekeeping of the securities and funds should be handled at arms-length by an independent and secure custodian.