Nancy Graham November 16, 2017 Personal Wealth “How Safe Is My Money?” (Part 2) In my last “No Dumb Questions,” I took on a question that most investors want to know more about, but may hesitate to ask their advisor. It goes something like this: Advisor, how safe is my money? The rest of the unstated question may often be … “How safe is it … with you?” It’s a fair question. Thankfully – as I covered in my last segment – huge scandals are rare, but they do happen. So do less sensational, but equally painful problems. What then? Besides the protection available through the Canadian Investor Protection Fund, which I mentioned in my last video, how is your financial advisor helping to protect your accounts … and what can YOU do to help? Briefly, the answers to both questions is: Quite a lot! Listen in to find out more. So, beyond advising you about how to invest your hard-earned nest eggs, what is your advisor doing to help protect those eggs from any foxes who may be skulking about your hen house? For that matter, how do you ensure that your “advisor” isn’t a fox in disguise? As good timing would have it, our firm’s Chief Compliance Officer Jennifer Vachon recently published a helpful post on this subject. Do you remember all that boring paperwork, and the endless questions your advisor takes you through when you first start working with them … and that we repeat all over again whenever we’re updating your accounts? Well … As Jennifer points out, we’re not running you through a bureaucratic gamut because we think it’s fun. Trust me, I’d much rather do my plank pose at yoga! But we do it anyway to help protect you against mistakes and malfeasance. What steps are you taking to ensure my money is safe? We begin by ensuring we’re remaining compliant with the “Know-Your-Client” and “Suitability” rules established by the Investment Industry Regulatory Organization of Canada … or IIROC. In other words, have we taken the time to get to know your financial circumstances – and to write it all down so we don’t forget it or get it wrong? PIPEDA or Canada’s Personal Information Protection and Electronic Documents Act on data privacy – –gets in on the action too. This obligates us to regularly revisit our processes and procedures, to help ensure that our firm and our employees are taking the appropriate steps to protect your privacy. There’s more. And all of it translates into that “quite a lot” I mentioned. But NO system is foolproof, which means you also play a vital role in helping us help you. Two simple steps can make an enormous difference. Conduct your business with an organization and an advisor who is a member of a federally or provincially regulated securities body. First, I mentioned IIROC as our industry’s main watchdog. There is also the Ontario Securities Commission – the OSC for example. Are you catching my drift? If you’re conducting financial business with anyone who is not registered with a Canadian regulator … watch out! You’re basically posting a big sign on your little hen house, saying: “Hey, foxes, come on in. The door’s open!” You can check for registrations on line. Second: The best way to catch a thief or an innocent error is to actually read those statements and reports I just mentioned – or at least give them a good scan! Keep your eye out for anything that seems confusing, inconsistent or just doesn’t smell quite right. A reputable representative will welcome your questions. And if someone isn’t so welcoming, an evasive or incomplete response can serve as a huge red flag. Rich or poor, young or old, savvy or simple … by incorporating these three tips into your financial best practices, you can go far to ensure that you don’t become one of the UNlucky few who get taken by an unscrupulous criminal or incompetent bureaucrat. Share: Facebook Twitter LinkedIn Email CIRO Advisor Report
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