Seeking Good Counsel: Vetting Advisors

Welcome to the January 2023 edition of our newsletter!  In this issue, we’ll examine the importance of properly vetting wealth advisors and estate planners.

Prey Circling Nest Eggs: The Need to Trust Retirement and Wealth Advisors

For most, retirement is a long-term goal which requires decades of planning – even for the wealthy, whose needs often scale with their fortunes.  From athletes and celebrities to lower profile individuals, stories abound about financial advisors or estate planning attorneys taking advantage of the trust placed in them to either siphon funds away from a client, or grant themselves excess power in the decision making process.  What can be done to prevent such malfeasance?

Both investment advisory and legal professions are tightly regulated, which aids in vetting individuals, even if it won’t deter true criminality.  Careful review of power of attorney filings is one way to make sure a client isn’t ceding too much authority, and a review of an advisor’s background can also be of use.  Was an estate attorney sued by a prior client’s family or estate after improper transactions came to light? Was a financial advisor sanctioned by FINRA or other relevant agencies, or taken to arbitration by a client, concerning improper investments on the estate’s behalf? A thorough check of litigation, regulatory filings and other public records would likely identify bad actors before they’re retained.

The same principle of due diligence applies to other personal wealth management, including family offices and trusts, as well as foundations.  Great success can often make an individual, or their family, a target for disreputable advisors.  As always, due diligence is a cost-effective preventative method against a host of bad actions.