Fake family offices emerge from shadows

Fake family offices are popping up all over the world, with loose definitions and limited regulation enabling misrepresentations to be made and leading to calls for processes to verify legitimacy.

- Matthew Wai

Australia's family office segment is maturing, employing as many as 20,000 people and managing about $140 billion in assets, according to KPMG. As such, it's almost double the size it was 10 years ago.

"There has been significant continued wealth growth in Australia, through a strong property market, business success from globalisation and innovation, and the mining boom, creating a broad range of areas where people have materially grown their wealth," Pitcher Partners partner Ben Lethborg says.

"This level of wealth in Australia probably wasn't here 30 or 40 years ago when you compare that globally. And therefore, historically, the concept [of a family office] probably wasn't as prevalent in Australia as it has been in European countries, the US, and maybe Asia, for a longer time span."

As a result, the term 'family office' has become somewhat of a buzzword in the industry.

"That term seems to be being used more regularly for families that are significantly wealthy, that I may not necessarily call a family office, to seek inclusion into exclusive financial networks or investment opportunities," Lethborg says.