Unfortunately, there are cases in which unregulated advisers sold unregulated products to expats. Often this is in the name of “tax planning” purposes. I am not a tax expert and so will not elaborate what this “tax planning” really means. However, the bottom line is this: if you buy this product, you'll get some tax benefits. The product concerned therefore must be regulated by the relevant jurisdiction and the adviser selling it must be regulated too. Sad to say, many expats in Singapore were sold unregulated product by unregulated financial advisers. These products are neither regulated by the MAS nor by the FSA. Actually it does not matter that the product is regulated by the FSA . As long as the transaction/advice was done within Singapore, the product must be regulated by the MAS otherwise it is considered illegal. Moreover, it does not matter whether the customer is expat or local for if any financial advice is rendered to the customer – regardless of nationality, race, religion, color, gender, etc they are subjected to the laws of Singapore. Obviously these laws are put in place to protect the consumer. I've seen a case in which an expat were sold an unregulated product by an unregulated adviser and the transaction was done in Singapore. The unregulated product is not approved by the MAS. The product was underwritten from an offshore jurisdiction at Channel Islands. I personally felt very uncomfortable for the client as any dispute means that the client has to fly to that jurisdiction and get his own legal adviser there. Put it this way, if there is going to be any problem, the customer is on his own.

Should I provide and give an example of such an unregulated adviser? Yes this is possible. An example of such company is Inter-Alliance International (Singapore) Pte Ltd. The firm was a licensed financial advisory firm (up to 18 Feb 2008) however it allowed 8 of its representatives to conduct financial advisory business without a valid MAS license. Secondly, the firm permitted its unlicensed representatives to sell unregulated insurance products. Thirdly, the firm did not have sufficient paid-up capital and professional indemnity.

For expats reading this, it is for your own good that you only deal with regulated persons and you should only buy regulated products. As for those “exotic” tax planning tools, don't make your life complicated by buying into unregulated products. Life is already hard, don't make it harder. It is not worth it.

Source: About Inter-Alliance  by MAS