There’s nothing like a set of letters after your name to create instant credibility
It’s possible for an unethical adviser to hide behind a front of enforceable ethical rules by calling himself or herself a fiduciary. For brokers, who are subject to a different set of rules, the standard is called suitability. Lest you think this protects you from abusive behavior, here are three stories taken from yesterday’s news recap at InvestmentNews, a website that caters to the professional adviser community.
F-Squared to pay $35M for misleading investors (story here)
WFG Investments hit with $700,000 Finra fine (story here)
Finra bars broker for ripping off elderly client (story here)
Holding yourself out as a fiduciary, or claiming that you must adhere to a suitability standard, creates an illusion of protection from fraud and abuse by your investment professional. It does not actually provide any real protection from those things. So, what can you do to protect yourself?
Ask your financial professional this simple question: can I have your assurance that you will always do what’s best for me, regardless of whether it’s also best for you? If he or she hems and haws, you have your answer. If he or she says yes, ask for written confirmation for your files.
You may not win any friends by doing this, but you will take a big step in protecting your financial assets.