In Spain firms that provide investment advice require a licence from the Comision Nacional del Mercado de Valores (CMNV). This is the regulatory body in Spain. Whilst the CMNV regulates the provision of investment advice, the reporting requirement, or auditing of advice only applies to institutions or companies in Spain offering advice on their own products.
This means that non-Spanish institutions, product providers, or investment companies selling offshore investments in Spain, even if they have a CMNV licence have no reporting requirement to the CMNV in respect of advice given in Spain. Similarly firms licensed by the CMNV to provide financial advice in Spain will never have their advice checked by the Spanish regulators, if the advice did not relate to their own investment products.
Given that the majority of companies providing investment products are ‘offshore’ and most firms providing ‘financial advice’ class themselves as independent, i.e. advising on products that are not their own, there are literally hundreds of investment companies, firms of financial advisors and individuals selling investments and giving advice in Spain that will never be reviewed by the Spanish regulatory body. In other words a licence from the CMNV to provide financial advice in Spain does not in most circumstances ensure standards and should not on its own serve to provide the consumer with implicit confidence in the ability of the holder to provide quality professional indemnified advice.
When choosing a company or individual to provide financial advice, it is advisable that you check that they are firstly registered by the CMNV, secondly have suitable, relevant and current qualifications, thirdly adhere to regulation standards of the country which in itself has more advanced and comprehensive financial regulation, and finally check the credentials of the firm or individual i.e. does their track record demonstrate their competence?