But what does advising clients from the DIFC actually look like? And how easy is it for advisers to continue servicing existing books of business?
In this article, Yeomans and Young outline why they chose to set up in the DIFC and whether advisers can continue to manage existing regular savings products from there.
With their clear vision and ambitious plans, the team at Farringdon is looking to grow. So, if you are a financial adviser who wants to work in a professional, well-regulated, well-respected environment, where the advice is based on economics and the client’s best interests are at heart of everything your firm does – don’t hesitate to get in touch.
The DIFC is the future of Dubai advice
Farringdon Asset Management Ltd was set up in Malaysia in 2007, branching out to Singapore in 2016, Dubai in 2019 and obtained its retail licence under Farringdon Capital Ltd in 2021 in the DIFC. When it came to setting up in the UAE, what made you choose the Dubai International Financial Centre (DIFC)?
Stuart Yeomans (CEO)
We have managed advisory businesses across multiple jurisdictions and knew from experience that the work of the DIFC regulator, the Dubai Financial Services Authority, is of the highest standard. This reputation is recognised by the end client, so that is the biggest benefit of being based here.
That’s not to say that it’s easy to set up in the DIFC. I have been based in Dubai for a little over two years and only now feel I have finally gotten to grips with the DIFC and the way the DFSA works. The regulation is very high, the reporting standards are strict and that forms the basis of the quality of advice coming out of the DIFC.
It’s also an innovative place. One of the main grievances we hear from people we interview from firms outside the DIFC is that they often have to argue or even take legal action to get their end of service benefit. The DIFC’s DEWS scheme, which is excellent, means you get this guaranteed every month and after leaving a firm it’s paid directly to your bank account. This again helps raise the jurisdiction’s reputation.
Martin Young (CFO)
One of the main advantages of being regulated by the DFSA is that prospective clients respect the advice that comes from the DIFC. They understand they are well protected under the jurisdiction’s guidelines and courts, which are independent, based in common law and are in English. This helps us open the door to new investors that may have been burnt by advisers operating in other regions.
And that’s not just appealing to prospects. More and more quality advisers are joining our firm because we provide them with a good framework to ensure their clients are protected.
What’s your view on the product range in the DIFC, can you manage regular premium contracts for instance?
Stuart
Let’s start with the regular premium indemnified commission contract first, this is one thing I can guarantee we have never sold in the DIFC and any adviser that joins us will not have to worry about the guy on the desk next to them, churning out 25-year term, after 25-year term.
I’m not saying that they are never warranted, but I think we all know that there are advisers in many parts of the world that churn them out and they are not enhancing the reputation of financial services. We simply don’t sell them here. I even hear that product providers are finally building new accounts that have no indemnified commission and no lock in. This is music to our ears.
This doesn’t mean that we can’t manage accounts like this, and we can obviously manage bond business, platforms, and private bank accounts. We are well set up and can manage both Retail and Professional clients from this office. So, to be clear – yes, we can manage these. If advisers wish to bring a book over, we do have a solution.
Martin
We have found, after a couple of dozen interviews, many advisers just want a place they can learn a different side to the industry, move up the ladder and grow. They have gone through three or four firms, and it is always a sideways move.
They have never considered a DIFC-based firm because they think that they can’t sell or manage their existing book. But we do have terms of business with the usual platforms and Insurance firms, and we can manage them.
Stuart
The great thing with what we can do from here is, as Martin says, manage the existing book, but the DIFC gives us the chance to educate the advisers on the private banking model, also known as external asset management (EAM). We do write case sizes of eight figures, and we have onboarded over $200m in the past 12 months across our businesses.
So, what’s next for Farringdon Capital Ltd?
Stuart
This one is simple. Provide advisers with a pathway to learn how to generate a higher ticket size, introduce them to the private banking world and give them a chance to expand their skillset.
Our branding allows us to operate like an EAM or multi-family office, but we can also manage adviser books. This is what a lot of advisers have been crying out for, but I don’t see many firms successfully operating between the IFA and private banking worlds.
Martin
We are looking for serious advisers that want to do a good job for their clients. We will deliver on our promises and train staff to a level where they can feel confident in front of someone worth nine figures and give them the toolbox to do so. We have staff across our offices that have closed eight figure accounts this year and I don’t think many firms can say the same.
One of my main tasks over the next year is to establish a UK operation so that we can better serve our clients and advisers when they return to the UK.
Stuart
So, if you are an individual who wants to work in a professional, well-regulated, well-respected environment, where the advice is based on economics and the client’s best interests are at heart of everything your firm does – please contact the team at Farringdon Asset Management on the usual channels, via LinkedIn or email us directly at [email protected]
