Asian wealth

There is a lot of interest in Asian wealth, whether Indian, China or if spreading a net wide areas like the Middle East.

Conducting some research with Hong Kong, Japanese and Singapore based intermediaries, a strange anomoly has appeared. Not only is wealth in Hong Kong rising to sums as grand as $20 billion US but trust companies ,that once flourished, have all but been purchased by banks in the region. This is something that is in stark contact to Europe where trust companies are de coupling from banks to avoid conflict with regard to investment management of trust monies (banks insisting the funds stay with them, rather than going onto the open market for best returns).

In Europe, as we have seen with Close Trustees and Close WM, it is seen essential to survival and ongoing growth to de couple and present wealthy clients and intermediaries with the sound knowledge that open architecture in investing is the only route for the money being entrusted to them.

As with Europe though one trend is similar. Asia hasn't got a large pool of intermediaries (lawyers/attorneys and accountants) to seek for work. On past trips to Singapore, banks in the region were 'raping' any professional firm of all their staff to equip themselves with a compliment of client relationship managers, who are identified as the most successful route to securing new private client monies into the banks. How that model works when there are no intermediaries left in the market to pitch too, must surely be a puzzle indeed.

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Geneva : elegance, tradition, good manners and lake-side living

Geneva, Switzerland, the home of wealth, is split by a fast flowing river (Lake Geneva) which gives the town a blustery, seaside air. The financial district is a walk away from most centrally located hotels and offers a chance for a pleasant, City walk to meet some of the most important private bankers in the world.

As with all of the financial destinations, there are many myths and views the industry has that often need a fresh set of eyes to change them. On my visit to Geneva, I heard many off-the-cuff comments like: “the Swiss are obsessed with time precision” or “the Swiss are dull and boring.” Whilst there may be a prestigious jewellery and watch industry, (which I plan to go back and investigate thoroughly); dull the Swiss are not.

Before my visit, the recommendations spilled in: “you will like Geneva best, don’t go to Zurich.” On my arrival in Geneva, every Zurich person I met couldn’t believe that I wasn’t visiting both cities; it became obvious that Geneva is the fork to Zurich’s knife. Visit both if you are targeting Switzerland.

Many liken the feel of Geneva to Jersey in the Channel Islands and this was something I heard a couple of times. Although this is not everyone’s preferred view (Geneva is more Euro-cosmopolitan), I can see what was meant. Essentially Geneva is a bijou, well connected community that has a long established financial strength and confidence. It is a contented, well nourished jurisdiction enjoying the finer things in life and does have an island feel.

Good manners are everything here and the French Swiss (Geneva is French Swiss and Zurich German Swiss), regularly comment on the good manners of those they meet or know. The philosophy is traditional, grand and operating at a sophisticated, intellectual and artistic level. Perhaps the Swiss created the wealth personality that is prevalent elsewhere?

In my view, the Swiss could never be classified as boring. For a start most are not Swiss. There are many other European citizens here making an interesting mix and conversations are conducted in at least two, three or four languages. Something that us ‘Anglo Saxons,' as the Swiss call us, struggle with.

I had a few stares of disbelief that my French wasn’t at a conversational level but most carried on chattering away, convinced that I didn’t really mean it. One thing you will not see much of in Switzerland is reception waiting areas. The Swiss believe they should immediately show guests into a meeting room as soon as you arrive. It is not entirely for secrecy reasons; it is also considered good manners to do this.

Contacts in the region

Whilst in Geneva, Maitland Group had a very grand party at the Parc des Eaux-Vives which ranks as one of the nicest venues I have ever visited. Although I’m sure it will have a fight on its hands this week the recent Ozannes Gherkin party, which I have been assured is the hot ticket of the year (let alone month). Maitland have an ex Macfarlanes person in their midst, a chap called Michael Hayes who was at Macfarlanes from 1974 to 2004 and Head of the Private Client Department from 1991 to 2000. He’s London based. Check out the side bar on the next page and their website - all the people profiles are upon it. http://www.maitlandgroup.com/.

I also met Paul Imison of EFG Bank who took me through the rapid rise of their success. Making major acquisitions throughout the world, they’ve grown from small to a world class organisation in just a few years which must make them the envy of their peers. Check out their website on http://www.efgbank.com/

Whilst there I was reminded about a solid, independent consultant (family office consultant and technology venture capitalist who is Geneva based), Hakan Hillerstrom. Find him on http://www.hillerstrom.com/.

For those of you interested in art in the region you can contact Guy Jennings at Theobald Jennings. http://www.theobaldjennings.com/

Swiss wealth industry

One third of the world's private banking wealth is managed in Switzerland.

Swiss-based companies may administer trusts governed by the laws of other jurisdictions, including the Cayman Islands, Jersey, Guernsey, the Isle of Man, Bermuda and England and Wales.

Switzerland is not a zero tax jurisdiction but the Swiss authorities allow trusts created by and for non-residents of Switzerland to operate without negative tax consequences.

There are approximately 400 banks in Switzerland.

This first appeared in http://www.citywealthmag.com/

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Family offices: peace of mind and independence for the super wealthy

Overview

The family and multi family office domain is a relatively small area of the private client world but it hides fortunes of breathtaking scale. With recommendations from family office experts that fortunes exceed £250m /$500m before setting up an office, providers have a pool of 946 billion and multi billionaires (according to Forbes 2007 list) to work with. Of course many will have inherited money and traditional family offices that have already worked through generations. But the biggest inter-generational hand over of wealth is now happening (a prime concern for uhnw is to offer a guiding hand when transferring a vast fortune to their families) and the need for continuity of personnel, (often not available in private banks) means the family office or multi family office environment looks set to continue its stronghold over the super rich purse strings.

The Family Office

The Times Rich list entry level is increasing year on year but when considering family office fortunes you are better referring to research material such as Forbes, who list more than 946 billionaires and multi billionaires, which is more likely the pool that the family office network is working with. Although some advisers says rich clients will consider the single family office (SFO) or multi family office (MFO) route at the £50/$100 million level.

The SFO/MFO (Alex Scott, SandAire explains the SFO/MFO meaning later) area would seem to be the golden egg of wealth, it has its detractors and there also seems a marked difference in how the USA and UK view the topic. It’s an area with entry level uncertainty: it seems if someone with a small fortune (in relative terms) of say £25/$50 million insists on taking this route, then advisers will help, but many would be reluctant and at worse would consider it a ‘vanity project’ i.e. keeping up with a peer social circle or ‘the Joneses’ as we say in the UK. All agree it is an expensive route to take and one that is best not considered unless at least a quarter of a million pounds or half a million dollars is being worked with.

Critics argue that finding best of breed (quality of expertise for ongoing advice) for wealthy clients can be an issue in an SFO arrangement. To set up a structure a lawyer or an accountant will headhunt to find a suitable ‘wealth head’ to build a team and be responsible for reporting to the family. But the role is not considered an aggressive career route nor is it suitable for those with lofty ambitions, who may be keen to use it as a stepping stone. It seems many would look for someone retiring from the wealth industry or someone with a keen sense of duty or staying power.

A multi family office arrangement doesn’t suffer from the same problems but it has other issues: for instance ongoing independency of advice. A stalwart reason super rich families work in family office arrangements (and this is the ‘sell’ from family offices) is that they offer impartiality without ‘product-pushing’ which is how large investment managers or private banks make money on wealthy clients. However more and more MFOs do have their own products (as they seek to add value to justify costs) which they develop over time and so the black and white independence issue may be moving into the grey. The other problem related to MFOs (this does not apply to the top tier family offices) is that although they save super rich families cost by sharing their office, they may also get diluted services that make the point of the family office less worthwhile (than perhaps an off the shelf banking service or trust structure).

A recent study that Daniel Martineau (Close Trustees Switzerland) and Hakan Hillerström (independent family office consultant) put together reviewed the offering and warned that super rich families should be wary of setting up a family office structure without serious thought: “Abandoning start-up MFOs happens regularly in Switzerland” said Daniel “they are usually set up by failed bankers, forced from employment by redundancy. SFO ‘failures’ are less likely as they are ‘sponsored’ by one family. We have a client who abandoned his three man office earlier this year when he realized that he could accomplish the same thing at less cost by giving most of the work to us, and then hiring a PA in London.”

But it isn’t all costs and trouble with staff, one family office adviser in New York says he effectively works as a private family office with his multi million and billionaire clients and is generally involved with all of their dealings globally (that require some sort of negotiation). He says many enjoy greater confidentiality choosing the family office route and a peace of mind not available elsewhere. He cites an example. “If you have a patriarch with sixteen businesses worldwide and he passes away, the complexity of the inheritance for children to take on would be difficult to comprehend, if not disastrous for the business. The family office enables simplicity in hand over.” He comments further, it also allows for group purchasing in investments – a family can reach minimum entry levels by pooling money together whereas separately they may struggle.” He adds “clients can also run all of their philanthropy or charitable projects through the family office.” He adds “clients choose to use me rather than set up a fully working family office because it saves them a long term commitment to people and premises.” He further comments “clients rarely want an office in an unpopular neighbourhood, which means property purchase is going to be in the millions from the start and you then have a lease to consider.”

Strangely in the USA, the family office set up had more detractors – mainly because hiring was perceived as problematic so most weren’t keen to recommend this route although all considered the traditional (and well known family offices) had performed well. In the USA also many accountants take the lead in running family offices but some thought this didn’t allow for a full compliment of skills to negotiate the terrain “you need to know about more than just money” one adviser said.”□

Industry comments about family offices

“Undoubtedly the single family office is a vanity project for some of the super rich, but the main motivation is frustration with banks who have been ‘product pushing.’ They think that having their own "trusted team" can help them navigate them through a sea of investment sharks.”

"I find it interesting that so much is made of the family office business. The truth is that it is a very small business, even the most visible, well known participants are quite small and very few multi-family offices are profitable, those that are will be marginally profitable. It is not the wave of popularity that is noted in the press or promoted on the conference circuit. Staffing an SFO is difficult. It often involves a family member and an accountant, banker or investment professional, it is very hard to pay (and therefore attract) top talent.”

Daniel Martineau, Close Trustees (Switzerland) works closely with many family offices to provide their structures. “Many trust structures have an element of "Family Office" in that we do the investment management monitoring, manager selection, bill paying or management of properties: the two work hand in hand. We manage a number of Private Trust Companies which all have an element of Family Office, usually in coordination with the dedicated single family office. “The single family offices tend to have more success and staying power as the services, by definition are exactly what the client family needs and wants. Its when they get the idea that they can take on other families to share the infrastructure costs that it starts to get more complicated. In the study that we conducted on Swiss Family Offices, it was clear that one of the key elements of a successful family office operation is to limit what they do, as they won’t be able to do it all themselves. Choosing expert outsourcing partners was seen as critical.”

Family office facts and contacts

The top five UK multi family offices (alphabetic).


◊ FF&P (Family Fleming & Partners, part of James Bond money)
Won the Trust company of the year Europe with Citywealth Monte Carlo
See event pictures
http://www.citywealthmag.com/montecarlopics.asp
See event write up
http://www.citywealthmag.com/Citywealth_Monte_Carlo_Awards_Edition_78.pdf

◊ Lord North Street

◊ SandAire
http://www.citywealthmag.com/Citywealth_SandAire_Edition_67.pdf
http://wwwcitywealthmagcom.blogspot.com/2007/12/sand-aire-family-office-tenth.html

◊ Stanhope Capital

◊ Stenham

Profiles of UK family office experts

Caroline Garnham

Daniel Pinto (co founder)
Stanhope Capital
London http://www.stanhopecapital.com/

Guy Paterson
Unigestion (UK and Switzerland)
+44 (0) 207 529 4150
http://www.unigestion.com/

UK family office consultants Peritus James Day
http://www.peritus.co.uk/


Profiles of Channel Islands family office experts

Jersey, Channel Islands

Brian Clarke, Key Trust
Brian is a Citywealth Top 100 peer nominated adviser
http://www.citywealthmag.com/citywealth_printable.pdf
http://www.key-trust.com/


Volaw http://www.volaw.com/

Mourants http://www.mourant.com/

Barclays Wealth, Jersey
Melvyn Kalman

Profiles of Swiss family office experts

Hakan Hillerstrom
Independent family consultant
http://www.hillerstrom.com/

Daniel Martineau, Close Trustees (Switzerland)
http://www.closetrustees.com/
Daniel is a Citywealth top 100 peer nominated adviser
http://www.citywealthmag.com/citywealth_printable.pdf

Swiss family offices

HSBC Private Bank (Suisse) SA

Julius Baer Family Office http://www.juliusbaer.com/

Marcuard Family Office (The biggest family office in Switzerland)
http://www.marcuardfamilyoffice.com/
Marcuard won the Family Office of the Year Europe with Citywealth
See the event programme
http://www.citywealthmag.com/images/CityWealth-Prog.pdf
See the event pictures
http://www.citywealthmag.com/montecarlopics.asp

Pictet & Cie Banquiers
http://www.pictet.com/


Profiles of US family office experts

Patricia Angus is Managing Director and head of Wealth Advisory Services at Shelterwood Financial Services LLC, a multi-family office serving ultra high net worth families. She is a leader in the developing field of family governance, and assists families with estate and philanthropic planning and processes with a particular emphasis on human relations to foster long-term family stability and successful stewardship of family wealth. http://www.shelterwoodfinancial.com/
Patricia attended the Citywealth California awards event
http://www.citywealthmag.com/CitywealthCaliforn-i-aEdition53.pdf

Mahoney Cohen
Managing Director
Mark Minker
http://www.mahoneycohen.com/
165 clients. The average client is worth $40 million to $200 million and up to billions.

Highmont Capital
Steven Hoch
http://www.hmcap.com/

Overbrook Management Corporation
Alan Reef

Jim McCarthy
President, AMA
Was also at Wilmington Trust
http://www.amaglobal.com/

Albert C. Bellas
Co Founder
Solaris Group
http://solarisgroupllc.com/

http://www.gellerco.com/

Citywealths next event for FAMILY OFFICES, WEALTH MANAGERS, INTERMEDIARIES, PHILANTHROPISTS and the SUPER STAR SUPER RICH is in London on May 8th 2008.
http://www.citywealthmag.com/ FOLLOWED BY CITYWEALTH MIAMI, JULY 2008, THEN CITYWEALTH MONTE CARLO OCTOBER 2008. Invitation only. Sponsors get choice of attendees.


Article from Sand Aire

For the wealthiest: a Family Office

Alex Scott, Chairman and a member of the family who founded SandAire, a multi-family office in London, seeks to add clarity to professional advisers’ understanding of this important specialist sector in the range of options available to the wealthiest of families.

“Whilst family offices have been in existence for centuries, usually established to manage private estates for wealthy families, the contemporary interpretation tends to focus on investment and providing broader support for the family. There are two prime forms of family office, the Single Family Office and the Multi Family Office, the former serving one family and the latter several. The decision to employ one or other is complex and multi-layered, but it usually doesn’t make sense to create a family office for a liquid fortune of less than £250m. Multi family offices are either independent (formed by a founding family or investment professionals), or affiliated to financial institutions.

The changing investment landscape is the reason for the rise of the family office. As investment has become increasingly complex, families and entrepreneurs with sophisticated investment requirements recognise the need for an expert organisation to act on their behalf as a filter for the myriad choices that lie before them in the long term management of wealth.

Whereas in the past, families were content to rely on single financial institutions to respond to all their investment needs, the fragmentation of the financial services industry means that optimal solutions might now be available from a combination of investment houses, both large and small. Family offices help wealthy families capitalise on the multiple opportunities resulting from this fragmentation.

Wealthy families are concerned that the advice they receive is really tailored for their needs and not just a pitch for the latest product for sale. They recall the adage: “Never ask a barber if you need a haircut.” Independent family offices work for the families they serve, not for a public corporation with quarterly profit statements to achieve. Conflicts within financial corporations are hugely difficult to manage; by aligning the family’s interests with a Family Office, these conflicts can be largely removed.

Contemporary families look to their family office to deliver results derived from an asset allocation created to provide absolute returns on a risk-adjusted basis. At this end of the market, risk analysis has become a key driver in establishing and monitoring such portfolios.

Having created an asset allocation built upon client-specific risk and return parameters, the role of the family office is to seek out investment solutions that can deliver the required returns and the talented professionals who deliver the solutions. Good family offices spend much of their time seeking the best and brightest in the global financial market.

At best, the family office delivers the purest form of ‘open architecture’. Their people, often with institutional backgrounds, build custom-made, flexible solutions for families using skills not normally available to private clients. Services are delivered according to the precise needs of the family.

There are other compelling reasons for using the services of a family office. Families with significant wealth have the opportunity to plan strategically, looking forward through multiple generations. A team of advisers from multiple specialist firms can be assembled for this purpose to assess their needs (ranging from choice of residency through tax and ownership structures to investment strategies) and plan accordingly. Such strategies require skilled implementation and the family office’s remit can range from delivery of the investment aspects of such a plan to acting as overall coordinator.

Some family offices go further than investment. They also deliver a comprehensive, personal service that is designed to support every aspect of living with wealth as a family – a practical and human dimension to the service that large financial institutions struggle to match. This approach is based upon an understanding that independent thought and action is culturally ingrained in many wealthy families.

These complementary tasks help families achieve their non-financial objectives. They range from consolidated reporting (fundamental for integrating the results of multiple suppliers) through project management, family governance, philanthropic coordination and planning to concierge services. Well planned and well executed, these supporting services release families from the detailed management of their fortune, allowing them time to think strategically and pursue their own commercial or personal interests.

As wealthy families become more sophisticated and the financial and investment choices open to them become more complex, a significant number are employing the service of a Family Office.”□


Article about their family office services from Key Trust

The concept of the Family Office has evolved since John D Rockefeller invented it in 1882 to manage his family’s assets and sustain their wealth – an example soon followed by other ultra wealthy families.

Brian Clarke, Managing Director of Key Trust outlines how the Family Office has become the means not only of handling a family’s commercial and investment expertise, but also of providing structures for wealth preservation for future generations.

Few families today would find it cost-effective to maintain their own Family Office. Over time it has become increasingly difficult to recruit professional managers who combine outstanding financial expertise with ‘people management’ skills (of which more later). And so the Family Office has evolved into its 21st-century successor, the Multi Office Family Office, which is what we offer at Key Trust. For us this means delivering bespoke family office services to each family client – not only managing and administering the investment and preservation of significant wealth, but also looking after generational issues and family dynamics.

The family will want to gain maximum enjoyment from the wealth that has been created – with minimum difficulties. We help them to achieve this through careful contingency planning, financial education for the younger family members and creating structures that enable each individual to make their own lifestyle choices while enjoying the benefits of a well organised family wealth system.

The basic principle from which we start is: take care of the business and it will take care of the family. If you take care of the family only, the business may not ultimately benefit anybody. Giancarlo Di Risio, the non-family CEO of the Versace family business empire, expresses this idea in another way: ”Every company today should run itself as though it were a public company…with clarity and transparency.”

I describe Key Trust’s service as bespoke, and it is. Too many wealth management businesses offer products – whereas the family requires service. This is especially true of a wealthy→ →family, whose individual members will have a diverse range of expectations and objectives.

We deliver our service by appointing a director and a manager to look after each family. They will get to understand their requirements in detail and so provide a response that meets the best interests of everyone concerned.

Our independence and focus on service helps us to achieve this. Having no products to sell, we concentrate on selecting the best of the best investment managers, monitoring their performance on the family’s behalf.

We are also able to actively participate in family wealth matters, setting up formal family meetings each year at which we work through the logic of all the issues in a way that is plainly seen to be impartial.

Initially this approach may produce tensions. But as a plan for the future emerges and everyone feels more secure about his or her own position, the family meetings become more enjoyable and constructive, even relaxed and sociable.

To prepare a structured transparent and fair approach to a well planned succession, we ask each family member a number of questions (see below). Their answers give us real insights into their personal and emotional aims. They also enable us to put wider questions to the family as a whole – for example:

· What is the role of the family business?
· Is it purely economic?
· Is it to provide the family with a means of transferring wealth to future generations?
· How is the family to go about achieving their business goals?
· Are there social or charitable purposes that should also be kept in mind?

The controlling parties in the family business spend a tremendous amount of their time creating value and driving the business forward. Even if they have the right skills to develop a business that might have been started 3 or 4 decades earlier, at some point in time they have to leave it and receive their reward. At that point they need to transfer some of the value and the organisation they have created either to a family member or deserving employee.

It is most important that this exit strategy should not be left until the moment when it needs to be implemented. An exit strategy needs to be thought out well in advance, even during the building stages of the business itself. In the end, an exit strategy should produce a transaction that is an almost insignificant event, because it has been planned and prepared for long before it comes to execution. It is in the planning and preparation that true value can be created.
This is where the Multi Office Family Office can play a particularly valuable role. Historic issues within the family often require an outsider to help resolve the interpersonal tensions that can exist between family members and the in-laws.

This works best when the outsider is someone who, with little to prove to him or herself, is able to work to the family’s agenda rather than their own. It obviously takes somebody with facilitation skills, an open and impartial communicator whose emotional maturity enables them to cope with dissent without expending undue amounts of time on individual family obstacles. This sometimes can require a person who can live with ambiguity and who also has a thick skin!
Ultimately the outsider the family uses should enjoy building things and working with people, a person with compassion and empathy who can think strategically and not just tactically.

In the case of my own firm, Key Trust, we certainly adhere to these principles in working with wealthy families. When we first get to know a family, the issues that we try to address from the outset include establishing our engagement with a clear legal contract and a defined financial position.

We then seek to meet and understand all the key stakeholders and characters inside and outside the business. Typically we will draw a ‘genogram’ – a family tree that shows who is male, who is female, who is a controlling party and so on. We like to try and understand the role of the various parties involved and the extent of their power. This enables us to distinguish from the beginning the difference between ownership and management.

Would John D Rockefeller recognise the modern Multi Office Family Office? I think he would: even while he was giving away more than half of his $900 million fortune, succession planning and the interests of each future generation were as much part of his thinking as they are of ours.□

Note from Karen Jones author: Read my recent blog posting on Rockefeller philanthropy consultants
http://charityandphilanthropy.blogspot.com/2007/11/rockefeller-philanthropy-advisors-not.html

Citywealths next event for FAMILY OFFICES, WEALTH MANAGERS, INTERMEDIARIES, PHILANTHROPISTS and the SUPER STAR SUPER RICH is in London on May 8th 2008.
http://www.citywealthmag.com/ FOLLOWED BY CITYWEALTH MIAMI, JULY 2008, THEN CITYWEALTH MONTE CARLO OCTOBER 2008. Invitation only. Sponsors get choice of attendees.

Read some articles from the super rich themselves

Monaco resident and chemicals multi millionaire
http://wwwcitywealthmagcom.blogspot.com/2007/11/look-at-successful-monaco-resident-and.html

Tracy Mattes sports star
http://wwwcitywealthmagcom.blogspot.com/2007/11/tracy-mattes-world-class-athlete-nbc.html

Percy Barnevik Swedish multi millionare
http://charityandphilanthropy.blogspot.com/2007/11/percy-barnevik-business-leader-and.html

DK Matia, risk tech tycoon and philanthropist
http://charityandphilanthropy.blogspot.com/2007/11/dk-and-his-wife-surinda-have-spent.html

The next generation of super wealthy. An Australian hotel entrepreneur
http://superichlifestyle.blogspot.com/2007/12/next-generation-of-super-wealthy.html

Stacy and Mouli Cohen - San Francisco billionaires
http://superichlifestyle.blogspot.com/2007/11/talking-to-client-stacy-cohen-us-based.html

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Wealth management American styley

Following on from the Citywealth Top 100 Americas list I spent some time in the USA over the quiet August weeks (2006), just pinging around meeting the professionals who had been recommended. Although many US names will be familiar to you – the likes of Karen Troy at RBC, Susan Harrington at Sidley Austin and Josh Rubenstein at Katten Muchin Rosenman, there may be others out of New York City who aren’t so familiar.

From our list of known wealth and private client friends, I am delighted to say that all received compliments wherever I travelled. Warren Whitaker, Josh Rubenstein, Gideon Rothschild, Ivan Sacks and Joe Field were all highly thought of and praised.

What was most interesting in contrast to London was a freedom – much less tradition - and clients from very different backgrounds. And although many accountants, CPA's or lawyers (or attorneys) were operating within one or several states - rather than internationally - they were all sitting on big honey pots of client money. Even Kansas was a hot spot for one entrepreneurial accountant (Don Harris – he manages £225/$450 million client monies – which is a small part of his business – counselling and planning is a greater part) who was regularly flying there from Dallas after a one off referral. He said it seemed to open local flood gates and his seminars were booked months ahead. We decided that they didn’t get as many visitors as they should in Kansas.

Susan Harrington at Sidley Austin (who travels to London frequently) is dealing for the most part with the wealth in South America and tipped me off about the Dominican Republic, which is apparently bursting at the seams with super wealthy clients – many of whom she advises.

RBC in New York reported that their client base was half US citizen and the rest non US as opposed to their Los Angeles branch which was considered more domestic wealth. RBC, NY are targeting the super wealthy and keen to seek out wealth advisers with international clients of net worth c$500m. They say South America is indeed a hot spot and substantial growth is being seen but this tends to get dealt with by their Miami operation. Problems of kidnapping are still rife in the region. Karen Troy’s top tips for excellent advisers were Jack Brister an accountant in New York City but we aren’t sure of his abode at the moment and Marco Blanco (attorney) Curtis Mallet-Prevost, NYC also received high praise.

Bill Knox (William) of Regent Atlantic Capital in Chatham, New Jersey had just got back from a trip to Italy (where he’s building a holiday home) and had been to see his new grand daughter in Switzerland. I’d liken New Jersey to the stockbroker belt in the burbs of Britain – lush greenery and manicured gardens – rather Sevenoaks or Kew in feel – very beautiful. Bill was very specific in saying that he only deals with clients of between $2-25million. Although he added that he manages $1.3billion of client monies and has a 99% client retention record of several years. He says his clients are New Jersey folk but many may have moved to other states or countries but have left their wealth with him to guard and grow.

Despite much information saying that the Americans invest domestically he insists a substantial proportion of all his clients wealth is invested internationally. He runs a model that mixes Global Large Cap, Hedge Funds, International Bonds, Real Estate (cutting back on Real Estate this year) and International Small Cap – amongst other investments in a tried and tested model that has outperformed indices consistently. He particularly likes Paine Webber, Smith Barney and MLIM funds and for international real estate uses a Morgan Stanley offering. Regent Atlantic Capital is furiously independent, buying in all expertise they need. They aggregate monies to help clients reach entry levels for funds of funds. The one exception is their own hedge fund “Regent Atlantic Absolute” mainly because they were offered expertise that was too good to turn away. You can contact Bill (who is really sensible, very bright and has good international knowledge of world politics on www.regentatlantic.com). It’s a two hour train ride to Chatham but is worth the trip.

Don Harris, of Beaird Harris & Co in Dallas said he is seeing a real upwards swing in philanthropy for clients with monies between £5-10million. He was very interested in the psychology of wealth and felt that advisers were keen to diagnose but often not prepared to delve into areas that might involve hopes and dreams or a soft side of planning. His one striking argument is that many people don’t know how much money they need or want or how much will be enough, if they did they would plan better and consider larger philanthropy or charitable projects. He was also investigating the negative ramifications of being rich – the children left with no purpose in life after inheriting huge sums. He impresses on those making plans that it is very important to involve children in processes because they are often not interested in parents goals nor in having huge amounts of money left to them.

Rounding off my trip I spent some time over a glass of wine with Michael Graham who was a delightful chap and also with Pamela Woodburn who has now left RBC for Jersey in the Channel Islands to get married but was in San Francisco. She kindly treated me to a swanky meal whilst there. □


Profiles


Donald B Harris
Beaird Harris & CoIs a wealth innovator, with a keen mind. Dallas based he recently co-wrote a book on wealth counselling “Getting to the heart of the matter.” His clients are enrolled in an intensive period of counselling in which a plan for life-goals and philanthropy are tied together. He says that they never rush the initial stage of comprehensive questioning which may take three months for the client to complete. Interviewing at home, he says its important that high net worth clients consider carefully all they’ve talked about. He says: Its imperative that families get a chance to really talk about their issues, then agree a forward strategy together, in order for plans to remain solidly intact.

There are 9,000 certified planners in the US.

Ed Copley, Akin Gump, Dallas. He works with many Indian high net worth clients, travels to London frequently and is a real Dallas gentleman. Ed Copley at Akin Gump, Dallas manages the estate of Wendy and Emery Reeves. The couple gave a furniture collection to the Dallas Museum of Art – as long the museum replicated the original setting of their home. It is jaw dropping with 15th century furniture and Picasso and Matisse paintings littered everywhere.

Michael Graham, of The Graham Law Firm, Dallas

Michael Graham is charming and his office resides in a small area of Dallas which is compared to Rodeo Drive in California. His office is nestled in a complex of boutique international designer and swanky eateries. He is keenly interested in technology and works more with high net worths that are running businesses these days. Michael has been featured as a “best lawyer in America” and is a fellow of ACTEC. His wife undertakes considerable charity work in China. This is his software: Interactive Legal System Estate planning software which is and Interactive Legal System – for experienced estate planners USA - offers a full complement of forms -- wills, revocable trusts, irrevocable trusts, strategic planning memos, powers of attorney, and more. While Federal in scope, state specific content is provided for all states (except Louisiana). The integrated "content help" is in a class by itself. From solo practitioners to large firms, WTP meets the demands of the most experienced estate planners

www.thegrahamlawfirm.com
http://www.ilsdocs.com/

Jonathan G. Blattmachr, Milbank

I didn’t get to meet Jonathan but Michael Graham says of him: “he is one of the greatest speakers I know, he can fill a room all by himself.” He is a member of the Alaska, California and New York Bars.

Observations and general information picked up on the trip

The Americans love Italy and talk about it constantly – doesn’t matter where you are or who you are talking to. Most have visited regularly – skipping the UK altogether. I asked one adviser what the affinity was. He said “at the very least the Italians seem to like us.”

Everyone in America is pointing at Texas for voting George W Bush in but the Texans deny this vigorously.

Atlanta has a 60% black population which is extremely affluent. Atlanta to the North is considered more internationally sophisticated than Georgia at its South.

Dallas is oil and technology wealth. Locals say that the wealthy wear jeans whilst their advisers wear suits. Don't forget the famous historic Alamo battle.

Vegas – super luxury, non gaming hotels are now taking a grip like the Christian LaCroix. The real estate market is extending away from the strip.

New Jersey is called the Garden State. North New Jersey is blue blood, traditional wealth and is extremely affluent. Conversely South New Jersey is considered below the poverty line.

Although there is a general phrase that ‘lots of Americans don’t have passports’ this does not apply to the business community who travel far and wide regularly – no matter where based.

Atlanta is nicknamed Hotlanta – it averages about 100 degrees a day and is
rarely cool. Bobby Brown and Whitney Houston are the Atlanta area's most notorious famous couple. The couple are often seen living it up at Atlanta's posh ‘The Palm’ restaurant. Jane Fonda, Elton John and Julia Roberts all have homes in Atlanta. The home of Coke - as my friend Joanna Forshee said "you wont find Pepsi here!"

My next trip to the USA is for LegalTech, New York in Feb 2008
See my tech blog here
http://wwwcitytechmagcom.blogspot.com/

And my tech publishing and events company here
www.citytechmag.com

Read about my Citywealth Los Angeles wealth management event at the Hotel Bel Air.
Citywealth has a weekly wealth newsletter that goes out around the world for £500 + vat/$1000. It advises about people in the industry and their clients each week.

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Sand Aire family office - tenth anniversary book for clients

Alexander Scott and Marcus Gregson who are both in Chair positions at Sand Aire, a top five UK family office, are a formidable pair. Alex has an esteemed family background which combines with Marcus, who was formerly Chief Executive at HSBC’s private bank. Celebrating its ten year anniversary this year, Sand Aire decided to buck the party trend and opted for a published book. It offers advice for ultra high net worths on the future unfolding over the next decade or two.

www.sandaire.com/

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