If you’re an OFW in the USA, You CAN’T Invest in Mutual Funds in the Philippines

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For the longest time, even before coming to the USA, I wanted to invest in Mutual Funds. I know that it is a better financial product than most banks’ savings accounts. We have spent more than 2 years in the USA and felt confident that it is time we spent some money to invest long-term. We had some amounts saved up.

I did my research, I read blogs, and checked some of the Filipino Financial groups on Facebook, and talked with my wife about it. My wife used to be a production staff of ABS-CBN News Channel’s “On The Money.”

I had a trip to Manila in October 2017 and we agreed that I will open a mutual fund investment account. I set my eyes on the Philippine Equity Fund. It was marketed as an aggressive, long-term investment fund. We did not want to withdraw the funds in the next few years anyway, so we thought we were in it for the long term.

So I checked out the requirements for opening a mutual funds account; downloaded the forms, checked what other documents I needed to present, and planned to go to a BPI branch to submit my application.

If you want to check the requirements for opening an account, go to http://bpiassetmanagement.com or download directly the PDF of the application form: https://www.bpiassetmanagement.com/upload/files/Downloadable%20Application%20Form__UITF_082216.pdf

When I went to the BPI Branch where I keep my account, I talked with a bank officer and she lodged my application. Surprisingly, she asked me to fill out another application form from ALFM, which is the subsidiary managing this account,.

I also needed to fill out the FATCA form, which determines whether you are a US person or not. FATCA stands for Foreign Account Tax Compliance Act (FATCA). This form asks if you are:

  1. A US Citizen
  2. A Green Card Holder
  3. Considered as a US resident for tax purposes
  4. Born in the US or a US territory

Essentially, if you are working in the USA and have stayed there for 183 days or more in the past 3 years, then you are considered a US person.

After filling out several pages of forms from BPI and ALFM, I discovered that as a US person, I am not allowed to invest in mutual funds in the Philippines!

It sucks.

But I understand that the United States has become more stringent in monitoring the movement of money of its citizens and permanent residents. So that meant that our plan to invest in a mutual fund did not materialize.

Oh well. It seems we need to look for other investment instruments and opportunities.

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1 Comment If you’re an OFW in the USA, You CAN’T Invest in Mutual Funds in the Philippines

  1. J

    Hi! I am a Mutual Fund Representative here in the Philippines. I just wonder what specific things made you ineligible to get an MF here in the Philippines… Can you please kindly enumerate the kinds of questions in the forms you filled-out that brought you to the conclusion that you cannot invest here in the Philippines?

    I am quite concerned about this post of yours because I do have US-OFW clients who were able to invest in Mutual Funds just recently. One of them actually linked this blog of yours to me. I hope you can bring light to this. Maybe, I can even help you if there’s any chance. Or, should the US government had some changes made that I don’t know of, at least I would be informed thoroughly.

    Thanks! God bless!

    Reply

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