Independent wealth management firm Tiedemann Constantia has expanded its operations in a bid to better serve its international clients, International Adviser can reveal.
It has opened a Geneva office and gained supervision from the US regulator Securities and Exchange Commission (SEC) to set up an entity to allow the company to serve American clients at home and abroad.
The Geneva office will be led by director Charles d’Oncieu, who joins from Cove Capital, a global macro discretionary hedge fund that he launched in 2017.
Switzerland-based Tiedemann Constantia is a partner firm of US giant Tiedemann Advisors.
Targeting US citizens overseas
There are not many options or opportunities for US citizens abroad with many banks and investment companies refusing to work with them due to financial complications surrounding the US citizenship-based tax scheme Foreign Account Tax Compliance Act (Fatca).
But Tiedemann Constantia has seen potential to work with US citizens overseas and has been given SEC approval to offer investment advice.
Robert Weeber, founder and chief executive of Tiedemann Constantia, told IA: “There’s still a moratorium on new SEC licences from the US due to Swiss data protection and also GDPR is so strong that they are unable to efficiently monitor SEC licence holders.
“We have a large US partner in Tiedemann Advisors, we were therefore able to extend the Tiedemann Advisors SEC licence to our new unit as a participating affiliate. This allows us to serve Tiedemann Advisors as our client in Europe.
“We are able to work with Tiedemann Advisors as a client essentially and offer the full suite of investment management services to US citizens and passport holders as well. We can directly leverage the full infrastructure and non-regulated resources out of the US. All investment decisions are taken in Switzerland by our chief investment officer.
“We have 130 people in nine offices in the US and we can work with Tiedemann Advisors as a client, I think we’re quite uniquely positioned.”
Dealing with complications
Tiedemann Constantia will be able to serve clients across “Europe and beyond”, which includes Swiss based US passport holders and European US passport holders.
Weeber told IA that the firm is already onboarding the Europe based family members of Tiedemann Advisors’ existing clients and it has been approached by several charitable foundations due to the “ability to manage assets in the US and in Switzerland giving them diverse geographic diversification”.
But the simplicity of cross-border planning can become tricky with policies like Fatca.
The US legislation sets out that any US citizen living abroad is bound, alongside their foreign financial institutions, to report data to the IRS for tax purposes.
The US is one of two countries in the world who has a citizenship-based taxation system, together with Eritrea.
Weeber added “There are multiple layers of defence in Fatca compliance. The first is that a good proportion of them are already Tiedemann Advisors’ clients.
“We go through stringent Fatca checks and declarations. We work with the typical network of large Swiss custodians and they are also avid about being an additional line of defence.”
Expansion after Geneva
As well as the SEC approval, Tiedemann Constantia opened a Geneva office to fit alongside its Zurich operation.
It also hired Sylvie Golay from Credit Suisse as chief strategist and deputy chief investment officer.
But Weeber admits more is yet to come for the independent wealth manager.
“The core business in Europe has been, for the last two years, non-US discretionary asset management for clients, spanning UK, Switzerland and some European countries,” Weeber added. “The pandemic forced us to dynamically explore new avenues, many of which in retrospect, have been very interesting for us and that we wouldn’t have thought of had the pandemic not occurred.”
“It forced us to think differently. We do have bigger expansion plans. The next step would certainly be to have an office in London. And from there, who knows? But that’s definitely the next step in our agenda. When we approach any decision like this, it’s first about the people. We take a lot of time before making a decision.
“We worked for almost two years before opening the first European office just to make sure we got it right. The benefit of having the Tiedemann name is the reputation, resources and heritage. But the flip side of that is we have a responsibility to protect maintain and build upon this reputation.”
M&A
Weeber also added that the firm’s growth plans could mean M&A deals and that company would “certainly look at acquisitions”.
He said: “There’s not a huge pool of opportunity for asset managers like us because of our characteristics and the fact that we are purely focused the ultra-high net worth segment.
“I think that there’s going to be an opportunity in Europe, specifically in Switzerland, and the UK in the next few years. If it makes sense for us from a cultural perspective, then absolutely, we’ll look at it.”
