Abstract
This chapter addresses the danger of inadvertantly selecting bad financial advisors. The current regulatory landscape, perhaps due to the impressive marketing and lobbying budgets of large financial service firms, disfavors the consumer. Fraud and other forms of misconduct occur more often in the industry than they should, and when they do, they are not always clearly visible to individuals seeking financial advice. Education requirements for advisors are nearly absent, and there is no uniform profession. Many if not most advisors are free to put thier own interest ahead of cleints’. The fact that fraud is difficult to define, combined with the fact that most people lack the resources to adequately investigate it, means that you must choose your trusted advisor very carefully. There’s more to an advisor than owing you a fiduciary duty. Regardless of how rich you are, in the wealth-managment business, you cannot afford to hire bad actors.
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Camarda, J., Lee, S.J., Lee, J. (2021). The Bernie Madoff/Bad Advisor Risk. In: The Financial Storm Warning for Investors. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-77271-0_6
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DOI: https://doi.org/10.1007/978-3-030-77271-0_6
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Publisher Name: Palgrave Macmillan, Cham
Print ISBN: 978-3-030-77270-3
Online ISBN: 978-3-030-77271-0
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