Five Star Quality Rating

Paladin uses a proprietary methodology to rate the quality of financial advisor credentials, ethics, and business practices one to five stars. Paladin only profiles five star rated advisors in the Registry.

Paladin ratings are based on data that are submitted by advisors. We validate the accuracy of certain data if advisors subscribe to Paladin's Financial Advisor Due Diligence (FADD) service. If advisors do not subscribe to the FADD service Paladin publishes data as submitted by advisors.

Paladin's five star quality rating and FADD service do not constitute an endorsement, recommendation, guarantee, or favoring by Paladin of any advisor and do not constitute a claim by Paladin, whether explicit or implicit, that advisor credentials, ethics, business practices, products, services, opinions, advice, recommendations, or claims are reputable, honest, competent, or will result in exceptional financial returns. Investors are solely responsible for advisor selection decisions that may be based on information that is published in the Paladin Registry. Investors are encouraged to request additional, current information from advisors that validates their competence, ethics, business practices, and services.

Bad Financial Advice is a Scam

We surveyed thousands of investors in 2009 to measure their awareness of bad financial advice. We were surprised to find more than 80% did not know how to identify bad advice before it had damaged them.

There are four primary reasons why so many investors are damaged by bad advice. First, most bad advice is legal. Second, financial advisors with strong sales skills are very adept at presenting bad advice as good advice. Third, good and bad investment products look a lot alike – the differences are in the fine print. And fourth, most investors do not take the time to obtain multiple proposals, use the Internet to conduct research, and read the all-important fine print.

Bad investment advice is a scam because it is disguised to look like good advice. And, since most investors don't know the critical differences between good and bad advice, they are vulnerable to this type of scam. The consequences can be disastrous because it may take a long time to determine they have been scammed. Just ask the clients of Bernie Madoff and Allen Stanford.

Bad investment advice is the world’s biggest financial scam because it impacts millions of people. There is a solution. It is called "avoid the messenger". The messenger is the advisor who is delivering bad advice to sell low quality products that produce big commissions. If you learn to avoid low quality advisors you can avoid their type of bad advice.

When you select advisors make sure they have the following characteristics:

They are Registered Investment Advisors or Investment Advisor Representatives
They acknowledge they are fiduciaries when they provide financial advice and services
They have clean compliance records at FINRA, the SEC, and State Securities Commissioners
They are compensated with fees for their knowledge and services
They never restrict your selection to particular products
They provide a service agreement that documents their services and compensation
They have no potential conflicts of interest
They use the services of brand name custodians