How To Know If Your Financial Adviser is Trustworthy

Being an Adviser

On the weekend my husband saw the front page of the Sydney Morning Herald on an article about a Sydney “financial adviser” who went missing around the time ASIC raided her multimillion-dollar home in Sydney’s Eastern suburbs. Friends saw her go from a modest unit in Surry Hills to an extravagant lifestyle… And now investors who trusted her with their money want answers.

Of course, as an adviser this news makes my blood boil. But I am not here to whinge and whine about the bad press we advisers get but to give you a guide on how to seek out a good adviser.

First and foremost, we all need to be working under a licence, in this case the woman in question stated she was, so how can you check? Well all this is public knowledge on the ASIC website. You can look up the AFSL and the authorised representative which is the adviser – like me (go ahead look me up). But why this is so important is that to have a licence- or work under a licence you need the required education, on going CPD training and to maintain strict compliance.

When first engaged with an adviser you should be sent a Financial Services Guide and Privacy Policy (which can be the one document). This gives you information about the firm, the services they are licenced to provide as well as your rights and an idea on their pricing.

If I have a call with you I will email you following the call to ensure you see your file note. This transparency will go as far as you know that any investment, insurance, or account set up and recommended is available to you. In the case of this woman in question, sent out fraudulent statements with the banks logo, but the clients never had their own online log ins like they would a normal bank account. Red Flag right there. Make sure (if banking or investing – including your superannuation) you have a log in which you can see your money working for you….. And this goes for insurance as well, you won’t get a online access but you can certainly call and check this information with the insurance provider.

Monthly investment reports are sent to my clients about their investment performance but this does not show their balance… make sure you are also aware of how your money is being invested, match this information up with your balance if you are concerned. During COVID-19 I was aware my clients would be losing money temporarily during those volatile times… I ensured my clients were aware with why and what was going on and that a recovery period would occur which would help recoup losses. Make sure your adviser is communicating with you.

And finally, being a financial adviser is hard work, but rewarding. I have made a comfortable life for myself and family, but due to changes in regulation and how we are remunerated the average adviser has taken a financial hit – I am speaking more of the self employed type like myself… so there is no way a one woman business would be able to afford a multimillion dollar property, buy her parents a multimillion dollar property, have millions in jewellery and travel annually to Aspen to ski…. Sadly, her clients were part of a PONZI scheme. which (with all the above information) can be avoided.

I write this because I know so many amazing advisers out there. If you are ever concerned you can contact the Australian Financial Service Licence your adviser operates under or go to government bodies such as ASIC or AFCA.