“Sign this form stating that you’ve read and reviewed this material” – Yeah, right

My relative’s investment advisor is changing firms, so his accounts have to transfer from the old company to the new one. To confirm this change, the new company sent a packet – as required – disclosing all of the material information my relative needs to know about the new firm: what they do, how much they charge, how to contact them, what to do if there is a dispute etc… (emphasis on the “etc…”). He was told to review the material, sign a form stating that he had done so, and return it in the mail.

It was almost an inch thick.

He called me over to check through it and, I admit, it was too much for me. Who is really going to read this stuff and, therefore, how is it supposed to protect those for whom it is written?

:Sigh: such is the plight of those of us in financial services; too many in our industry (or posing as such) have swindled too many people out of their hard-earned money that the rest of us have to hire attorneys and typesetters just to tell people what we do. We can’t just tell them, they must be told in a certain format approved of by whichever governing body currently approves of them. The majority of financial advisors list “compliance” as their top business challenge. I wonder how much more productive we could be if we could focus our energy on being…productive. But, we’re in a bushel of more than a few bad apples I’m afraid.

So, back to my relative. I scanned the material, recognizing most as required template in most disclosure forms of this type, and questioned the few that stood out as unusual. He signed the form and put it in the mail. Let me add that he opened the account 25 years ago with a handshake and his advisor’s word. It’s too bad a man’s word, no matter how valid, is no longer enough. Let me also add that, no matter how many disclosure forms sent by Bernie Madoff’s firm, people still lost everything.

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About Amy Jo Lauber

I help people who are overwhelmed take control & make good financial decisions with confidence and experience peace and abundance. Are you ready to say goodbye to working hard but not having anything to show for it? Go to www.lauberfinancialplanning.com "Let's Talk" tab to schedule your complimentary initial consultation and take the first step on the path to financial empowerment.
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