Is PAMM illegal everywhere in the EU?

Managing accounts has become illegal in Italy. It can get you in serious trouble: up to 4 years imprisonment !



I was wondering, is there a country in the EU where you don't need specific permissions to manage people's accounts ? Maybe Malta or Cyprus ?

are you sure? once you have the poa filled and signed from the investor(s) there must be no problem.

100%! a signal provider is considered a financial consultant operating illegally and account managers are considered asset managers and financial consultants operating illegally. Basically you're acting as a bank without being a bank.


I don't know about other countries, but in Italy this is the (crazy) reality.

https://en.wikipedia.org/wiki/Altern...gers_Directive

however it's just crap, if you just know the investor (that have an account opened in his own name) and agree with him to trade his account, then it's a private matter between you and him, as i written before, just a power of attorney is enough to make it right.

Even if there are some stupid regulations somewhere, nobody apart from you and him is going to know who is trading what and why.


I guess with PAMM is another story, pamm is more like a public stuff so you may have to be careful doing that.
Anyway (a big anyway), i still doubt somebody (some government enforcement) is going to bother with you, we live in a pretty free world.
UNLESS you get a few millions usd under management in your pamm (let's say 100/1000 investors) and you make some big loss (it can happen!), and then you have some hundred angry investors knocking to the law enforcement asking for justice.

This can happen also with just 1 investor (poa), if you make shit with his account (a big loss) and he goes crazy then you may get in trouble.


Moral of the story: stay away from other people money. Unless you are fully regulated (i guess you are not).

It isn't worth the stress and the risk.

Yeah very probably you will not have any problem. But better knowing what you're risking .

Just to be clear (and then i guess that's all for me, don't wanna be boring ), my advice is to NOT manage other people money at all, UNLESS you are fully regulated.

This article does not say which countries are still "unregulated", but thanks anyway.

Unless you are running a regulated portfolio management or trading on behalf of others. Then you are basically running out of luck in the EU.

Solutions:-

 

1. You can work under an umbrella of a regulated advisory firm in the EU, and they will do take a % of your profits. They have to run some due diligence and the process can be lengthy. Although there are some providers in UK, Cyprus and Switzerland that are willing to do that.
2. Provide your account management services from a broker outside of the EU. Therefore neither you or your client need to adhere to such regulatory obligations.
3. Provide your services as signal provider. Earning on the basis of monthly subscription will enable you to operate in the EU with your cleints without the need to sign a POA.

It is ok in Switzerland. However, Switzerland is not a member of the EU.




(Disclaimer: This is no legal advice)

Thanks for the info !

To abstractwlth, as I said signal providing is illegal too where I live, only financial advisers/promoters/consultants can do that.