Investors Need Protection From Bad Financial Advisors

There are good financial advisors and there are bad financial advisors. In fact 75% of financial advisors are not really advisors. They are sales representatives masquerading as financial advisors. Reps get away with this sales tactic because less than 10% of investors have a process than helps them determine the quality of advisors before they select them. They make decisions based on processes that are controlled by financial advisors.

You are solely responsible for protecting your financial interests. But, you need a process that puts your interests first. However, if you are like most investors you do not have the knowledge or time to develop a process of your own. Paladin Research ( has developed a process for you.

Marketing Tactics

What chance do you have when you are up against Wall Street’s sophisticated marketing tactics? The answer is none. Wall Street has had decades to develop finely tuned marketing strategies that its advisors use to dominate relationships with investors.

The marketing tactics work because you do not have a counter-balancing process that protects your interests. Wall Street has taken advantage of this vacuum for decades.

The Regulators

Don’t expect much help from the Regulatory agencies. They are more about enforcement than they are about prevention. And, they can’t protect you from yourself. For example, you are on your own if you select advisors based on verbal sales pitches and no due diligence. There is no way regulatory agencies can control what an advisor does and does not say to you.

It’s Your Money

You need a process that puts you in control of key decisions that impact your relationships with financial advisors.

  • Who should you select to be your financial advisor?
  • Are you receiving competitive performance for reasonable risk and expense?
  • Should you retain your current advisor?

You are solely accountable for obtaining the information you need to answer these questions. You have to ask the right questions, know good answers from bad ones, and obtain documented responses so you have a permanent record.

Paladin Advisor Research

Paladin Research ( provides free online tools and information to investors who use the services of financial advisors. One set of tools helps you select the best advisors. Another set helps you monitor current advisors. And, a third set helps you minimize risk and expense when you replace advisors.

Several Paladin tools also produce ratings so it is easy to compare advisors to each other. For example, an inexperienced advisor with no credentials will have a one star quality rating. An experienced advisor with excellent credentials, a clean compliance record, and investor-friendly business practices will have a five star quality rating. This is the information you need to select the best advisor.

Paladin also provides a free quarterly monitoring service. This service also increases your control over your relationship with your current advisor. For example, advisors do not volunteer information that will cause you to fire them. They withhold the information unless you ask the right questions. Paladin’s monitoring service asks the right questions and archives advisor responses.

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