DeVere Group has licence suspended following probe [1]
Submitted by kerry.nelson on May 19th 2015, 10:46pm
Business›Companies REGULATION
Benjamin Robertson Benjamin.robertson@scmp.com
CIB decision follows investigation into financial advisory firm’s sales practices by regulators
Financial advisory firm deVere Group Hong Kong has had its licence suspended as part of an investigation into its operations by regulators. The Confederation of Insurance Brokers (CIB), one of two self-regulated bodies that supervise local brokers, said yesterday it had suspended deVere’s membership until a disciplinary investigation had concluded.The CIB decision, reached on May 12 and announced in a statement yesterday, effectively prevents deVere from accepting new business and comes following a probe by the South China Morning Post into allegations surrounding the firm’s sales staff.
The CIB statement said it had suspended deVere under Article 32 of its ordinance, which governs member conduct.
The original Post report named six deVere staff including then Hong Kong operations head Edward Rice as working in client-facing roles without a CIB licence – an offence under the Insurance Companies Ordinance. The Post also detailed client complaint letters sent to the CIB.
DeVere said at the time that none of the named staff were client facing and therefore licensing was not required.
DeVere, which claims to have 80,000 clients worldwide, has been disciplined eight times by the CIB in the past nine years for breaches of industry rules.
Industry veterans had told the Post they expected that the deVere-branded brokerage would eventually close in Hong Kong because of the allegations.
They added that Nigel Green, who operates the deVere brand worldwide – including the Hong Kong firm at the time of the Post‘s original reports in 2013 – had bought other brokerages since to enable his business to operate.
One, rebranded as Acuma, has become Green’s new Hong Kong base.
Acuma has been fined twice in the past year, according to the CIB website, although both fines relate to misdemeanours that preceded Green’s involvement. Acuma is applying for a Securities and Futures Commission licence, say industry sources.
A spokesman for deVere Group said in an emailed statement it had sold its Hong Kong shell company last year and was not involved in the current CIB investigation.
Green and deVere have a long history of regulatory penalties and client complaints spanning the globe. In 2008 deVere was fined in Singapore after local regulators discovered the firm had employed eight unlicensed sales staff, according to a regulatory notice at the time.
The Japanese Financial Services Agency last month told the Post that deVere was operating in Japan without the necessary licence. The firm also appears on the Thai Securities and Exchange Commission alert list of unlicensed brokers.
DeVere has repeatedly denied to the Post over the past 17 months that it was under CIB investigation.
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