As an American citizen who lives in Iowa, in Idaho, in Arizona, would you invest in a private company in Spain; in Italy; in France? Do you understand the laws or the regulations or the legal risks? Would you know who you can sue if your money disappears and what the process is, or how you would retain an attorney in a foreign nation and how the law works? If the private company you invested in owns property in its home country on its balance sheet, would you understand land rights; title ownership; national eminent domain equivalence laws? How easily can another nation take property from a private company if that nation wishes to own it? Would you know anything about tax laws in Greece; in England; in China? We can barely understand tax laws in the United States.
If you looked at company executives of foreign companies, would you know what their foreign educations mean? Would you know if an executive in Thailand has family government ties that have given his company advantages that may change with a new government?
Would you have any idea at all how foreign S.E.C. and Federal Reserve equivalents work? Or what they are even called?
Would you know the values, platform, or goals of the government of the day? Would you know the stewing social issues or if there is any brewing social unrest or civil strife?
Would you know the bills (or whatever they’re called in a given country) being considered, or those to be proposed for a vote to become new law? Would you even know the process for that in any other country? Do you even fully understand these things in this country?
If your money disappeared in a giant fraud in Egypt or Russia, do you think there would be a class action lawsuit that has substance? Will lawyers in these nations fight hard for your rights? Do you think you would see your money ever again?
Would you know what kind of legal system is in place? Is it common law, civil law, religious law, some other system? Would you know if they have case law precedent, or how one becomes a lawyer or a judge in that country? Or if they allow juries or have a local judge to decide cases? Would you know or understand any of their legal processes or procedures?
Investing in a foreign public company on a foreign exchange is no different than putting your money in a foreign private company. How can a person invest in a company in another country without any understanding of that country’s laws, and, thus, risks? As for fairness and regulations and honesty, Bernie Madoff was not controlled or caught by United States securities regulators for years and years; can you imagine how many Bernie Madoffs exist in Asia, or in the Middle East? In China, the national government owns parts of companies. Do you think the country’s leaders would regulate and punish its own companies for unfair activities from which the government or its officials benefit?
Contrary to popular belief, a company being “public” does not provide an investor with more protection than if such company is “private”. In fact, it can be exactly the opposite for many reasons. If a company is public, investors presume regulators are protecting them from fraud. But that’s not the case. Moreover, if a company is public, the officers and executives can make decisions and enter into transactions without disclosing many of the specifics to shareholders. Contrarily, a shareholder in a “private” company is entitled to know most, if not all details of transactions, by law, or by agreement of the shareholders.
If you watch CNBC, guests, money managers, analysts, and traders tell you that foreign indices are providing bigger returns than domestic ones and that it would be smart to diversify globally. But these “advisors” and “manager” never mention the legal risks- because they don’t understand them. Bigger returns can come with bigger risks- which can also result in bigger losses. Lack of any clue of what you are getting yourself involved because someone on TV told you to do it, is the biggest risk you can take.
Neil S. Siskind, Esq., President
The Siskind Law Firm
Neil Siskind is the Founder & Chairman of The Fatherhood Assignment
Learn more at: http://www.neil-siskind-the-fatherhood-assignment.org/
Neil Siskind is the Conservator of the Neil S. Siskind Nature Preserve
The Neil S. Siskind Nature Preserve is over 7 acres of environmentally-pristine waterfront land in a magnificent setting along New York’s majestic Hudson River. The Preserve includes a variety of species of animal and plant life, and is a precious example of the thoughtful maintenance of New York’s priceless open spaces. The land’s uses are limited to outdoor recreation such as hiking and climbing, and the study of ecology, nature and land use. The Neil S. Siskind Nature Preserve allows for the intelligent contemplation of our valuable natural resources and the most effective ways to maximize them and keep them protected.
Neil Siskind, Founder, “National Fatherhood Day” – March 29th
Read about the non-profits and charities whose missions Neil Siskind supports and promotes: www.neilsiskindsupports.com
Caring is Free®
You can read what clients and associates say about Neil Siskind at: http://siskindlawfirm.com/neil-siskind-bio/.
Neil Siskind’s Volunteer Work:
– Memorial Sloan Kettering Cancer Center, Volunteer
– Memorial Sloan Kettering Cancer Center, My Fundraiser- Help Neil Siskind help children with cancer to be more comfortable: http://mskcc.convio.net/site/TR?px=3182108&fr_id=2632&pg=personal
– Make-A Wish Foundation- Help Neil Siskind make sick children’s wishes come true by creating your own fundraiser: Neil-Siskind/Help-Make-A-Child-Smile.htm
– DonorsChoose.org- Donate to one of my needy public classrooms: http://www.donorschoose.org/NeilSiskindGiving
– Champion Children– We seek to inspire people through stories of children who have overcome challenges: http://siskindlawfirm.com/neil-siskind-champion-children/
Neil Siskind’s Pro Bono Work:
– Saving Senior Citizens- Protecting New York’s senior citizens from fraud and financial abuse www.savingseniorcitizens.com
– Senior FreeStart Business– Pro Bono: We seek to help put senior citizens in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/
– Veteran FreeStart Business– Pro Bono: We seek to help put Iraq and Afghanistan war veterans in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/
– In development: The Neil S. Siskind School of Hope: A free school to teach inner-city youths the skills of entrepreneurship and importance of economic self-sufficiency.
Neil Siskind’s Government Work:
– Suffolk County District Attorney’s Office, Boston, MA, 1994, Intern
– Office of Senator Christopher J. Dodd, Newington, CT, 1992, Intern
– Hartford County Department of Probation, Hartford, CT, 1991, Intern
Neil Siskind’s Community Assistance:
Financed & operated a legal clinic providing low-cost legal services to struggling Long Islanders during the recession to help clients resolve debt, organize finances, and launch new businesses.
Neil Siskind’s Professional Curriculum Vitae: http://neilsiskind.com/
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