With a background firmly rooted in the financial services sector, the owner of European Financial Planning Group (EFPG), Tom Fraser, has a wealth of experience which led to him establishing the company back in December 2004. Since then EFPG has grown and now employs fifteen staff administering about £300 million of client assets. He talks to Jo Ward about what led him to set up EFPG and how the business is looking after its clients in the current economic climate.
Born in Australia, Tom Fraser became a Chartered Accountant and was a salaried partner with Ernst & Young before moving to the UK in 1993. “I have always specialised in audit and consulting within financial services and whilst I was in the UK I was instrumental in building Ernst & Young’s compliance business,working with clients like Norwich Union, Generali, Irish Life and Aon,” he explains. In 1995 Tom was offered a partnership in Ernst & Young UK but left to join Norwich Union, where he was appointed as the Finance Director for one of their new divisions, moving on to act as Finance Director for Norwich Union Life & Pensions during its demutualisation. “I then became responsible, and eventually the main board director for, Norwich Union’s Overseas Operations – which is where I first came into contact with Gibraltar and the offshore markets,” Tom states. When Norwich Union merged with CGU, Tom became European Managing Director for the rebranded ‘Aviva’ and subsequently went on to run the UK Financial Services division of AMP (the owner of Pearl Assurance), NPI, London Life, Henderson Global Investors and Towry Law.
“Looking for new opportunities, I left there in early 2003 and became involved in a small investment bank in the UK called European American Capital, whilst also holding a number of non executive directorships. This in turn led to being asked in 2004 to come to Gibraltar to examine a complex issue for one of the brokers which involved Traded Endowment plans.” It was during this time that Tom realised he was enjoying his time in Gibraltar and took the opportunity to set up EFPG.
“We are a typical life and pensions financial services company with one difference, in that we pay our advisers a salary with bonus as opposed to commission only,” Tom explains, “with the idea being that they are more likely to act in the best interests of their clients as opposed to being driven by the generation of commission from insurance products.”
After a brief sojourn in 2006 when Tom went to Luxembourg for three years, he returned to Gibraltar and became more involved with the daily running of EFPG. “As the world changed and pensions changed, we established our own pension funds,” Tom says. Part of that change was driven by the fact that some of the larger traditional providers of financial service products in Gibraltar pulled out or restricted their product offerings, including Aviva, Clerical Medical and Legal & General. “We were left with so few providers we had no choice but to build our own products. We now have on offer our own QROPS, QNUPS (offshore pensions) and a local pension called Jubilee.”
Since then EFPG has continued to progress and Tom says that last year they split the business into two elements. “We have an advisory company, trading as Effective Financial Planning Group, which operates under Blacktower, and then we have our pensions company which continues to trade as European Financial Planning Group. This company is responsible for running the new pension schemes whilst acting as Trustee and also working with employers as Trustees”.
“We are definitely a local business – particularly today in these unprecedented times of corona virus when it is all a bit tough for everyone.”
There is no doubt that one of the main concerns for clients is to know what’s happening in the financial markets, particularly with regard to pensions. “The first thing we say is that your money is there for the long term – it is a ten, twenty, thirty year investment – it is not short term,” Tom clarifies. “As we have seen from the stock market crash in 2008, markets will come back and the key thing here is for people not to panic sell.” He goes on to state that the reality is that if people have some cash available, it is probably not a bad time to invest into the market.
Tom emphasises that he thinks the Gibraltar economy has been remarkably strong, but that like a lot of other smaller countries in the world, it is dependent upon two or three big industries and those will obviously have been impacted by the fallout from the corona virus issue. “Financial services are in a similar situation, but people forget that we are there to help our customers and service them, although I understand whilst we are in lockdown, financial services and pensions are not their top priority,” Tom says.
One thing that he wants to stress is that people shouldn’t give up their financial service products now, because they will become more expensive later on. “It is quite staggering how many people, both in Gibraltar and elsewhere in the world, don’t practice basic financial planning,” Tom states.
“The key thing that I would recommend to our existing and to our prospective clients is to look to the future, both for themselves and for their families,” Tom concludes adding that “it is important to relax and not panic, because we need to make the right decisions that secure our financial future and these need to be made in a calm and logical way, taking the best advice to ensure that financial stability happens!”