Hiring a financial advisor is something you should put a lot of thought into. An advisor can be extremely helpful if you are not sure how to manage your money or when you are planning to reach financial goals. However, if your advisor is not truly looking out for your best interests or is engaging in deception, it could negatively impact your finances. There are rules in place to govern how financial advisors behave with their clients and prevent them from acting unethically. Two important rules deal with misrepresentation and suitability of investments.
Misrepresentation: Lying or omitting material information regarding an investment. The client is told one thing about their investment or is not fully informed of material facts regarding the investment.
Suitability: When a financial advisor invests a client’s money in a way that is not suitable for the client’s objectives. For example, if a client’s financial situation is better suited for low-risk investments but the advisor ignores this and invests in high-risk securities, the advisor acted against the client’s interest.
You can protect yourself against advisor misconduct by checking their reputation with previous clients and governing agencies. Researching an advisor in advance is a very effective way of avoiding advisors who are likely to engage in misconduct.
How to Avoid Disputes
Always do your homework on a firm, broker, planner, or advisor before deciding to work with them. Before hiring a financial advisor, make sure they are willing to answer all of your questions and that you understand their answers. You can also check the advisor’s credentials and reputation by checking with a source like BrokerCheck, which will show you any complaints they have received from other clients. Do your research before hiring a financial advisor and continue to ask questions throughout your relationship.
How to Resolve Disputes
If you suspect that an advisor has acted improperly with your assets, you should first try to work it out with the advisor or the firm you are involved with. If you are not satisfied with the way things are handled after you state your concern, your next step is to write a written complaint with the Securities and Exchange Commission or the FINRA Investors Complaint Center. You can also hire an attorney to assist you in submitting your complaint and initiating dispute resolution procedures. An attorney will be able to determine whether your claim has merit and, if it does, your attorney will help you decide what to do to resolve your claim.
If you or a loved one hired a financial advisor who appears to no longer be handling your finances correctly, you should seek help from an attorney as soon as possible.
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Gaslowitz Frankel LLC is Georgia’s premier fiduciary litigation law firm. The firm has earned a reputation for excellence across Georgia and the Southeast in providing representation to individuals, executors, trustees, investors, shareholders, and financial institutions in complex fiduciary disputes involving wills, estates, trusts, guardianships, conservatorships, businesses, and securities.
