• 14
  • February
    2012

The Certified Financial Planner Board of Standards, Inc. certifies financial professionals. It has recently published the Guide to Financial Self-Defense to help protect consumers from fraud and mismanagement by financial advisors and financial planners. This booklet describes many "common situations" in which consumers are victimized, identifies "red flags" that warn of trouble, and explains steps you can take to protect yourself.

The situations described as common or raising "red flags" include -

  • When the consumer is presented with paperwork and told, "Just sign here. I'll take care of the rest."
  • The consumer is asked to make the check for an investment payable to the financial advisor individually and not his employer.
  • The financial advisor pressures the consumer to invest because "the offer is good for today only."
  • The financial planner presents an investment as "can't lose" or only for "special clients."
  • In response to the consumer's questions about an investment, she is told, "It's very complicated. No need to bother you with all the details."

The booklet explains how seniors are particularly vulnerable to financial abuse, resulting in losses of "more than $2.6 billion annually. Yet, four in five cases are not reported."

Download a free copy of the booklet from the CFP website: CFP Board Financial Self-Defense Guide