{"id":1193,"date":"2013-07-17T09:23:36","date_gmt":"2013-07-17T16:23:36","guid":{"rendered":"http:\/\/staging-prblog.paladinregistry.com\/blog\/?p=1193"},"modified":"2024-08-12T08:18:00","modified_gmt":"2024-08-12T12:18:00","slug":"weighing-in-financial-advisors-and-investor-assets-no-possession-allowed","status":"publish","type":"post","link":"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/","title":{"rendered":"Weighing In: Financial Advisors and Investor Assets – No Possession Allowed!"},"content":{"rendered":"

\"Financial<\/a>Investors should pay more attention to who has physical possession of their assets, see<\/em> Madoff Case Puts Focus on Duties of Custodial Banks<\/a>.\u00a0 This is the role of a custodian and not financial advisory firms or their representatives. In fact, based on regulations, financial advisors and their firms are prohibited from coming in contact with their clients assets – except their fees. This creates the need for a custodian to take physical possession of assets, process trades, collect dividends and interest, and produce monthly custodial reports that are also called brokerage statements.<\/p>\n

Due to the important role of custodians investors should limit their selection of financial advisors and stockbrokers to professionals and firms that use the services of brand name third party custodians such as Charles Schwab, Fidelity, Pershing, and TD Ameritrade. Or, limit their selection of firms that have in-house custodial services to brand name firms. A brand name firm will be responsible for hundreds of billions of dollars and have a long, clean history of providing this type of service to hundreds of thousands or millions of investors.<\/p>\n

Madoff used a small, inexperienced custodian to steal from investors. This should have been a major red flag for more sophisticated investors – why did he pick this particular custodian just like he picked the small Long Island CPA firm to audit his accounts? He selected service providers that were easy to control and manipulate. Investors should learn from this debacle and automatically reject small custodians that are recommended to them. Why take this risk when they don’t have to? Perhaps if Madoff victims required a brand name custodian he would have turned down the accounts to avoid scrutiny and his victims would still have their assets.<\/p>\n

Based on the court documents it sounds like investors and their advisors should require custodians to disclose exactly what they are and are not accountable for. Advisors should provide this document to investors so they have reasonable expectations about the services of the custodians. They have a right to this information because they pay significant fees to the custodians. Investors may be surprised by what the custodians are not accountable for. This is called full transparency and investors should not do business with organizations and advisors who do not practice it.<\/p>\n","protected":false},"excerpt":{"rendered":"

Investors should pay more attention to who has physical possession of their assets, see Madoff Case Puts Focus on Duties of Custodial Banks.\u00a0 This is the role of a custodian and not financial advisory firms or their representatives. In fact, based on regulations, financial advisors and their firms are prohibited from coming in contact with their clients assets – except their fees. This creates the need for a custodian to<\/p>\n","protected":false},"author":2,"featured_media":1195,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[325],"tags":[],"class_list":["post-1193","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-advisors"],"yoast_head":"\nFinancial Advisors and Investor Assets - No Possession Allowed!<\/title>\n<meta name=\"description\" content=\"We believe that financial advisors and investors should be fully transparent in what they are accountable for.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Financial Advisors and Investor Assets - No Possession Allowed!\" \/>\n<meta property=\"og:description\" content=\"We believe that financial advisors and investors should be fully transparent in what they are accountable for.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/\" \/>\n<meta property=\"og:site_name\" content=\"Paladin Registry Blog\" \/>\n<meta property=\"article:author\" content=\"https:\/\/www.facebook.com\/PaladinRegistry\" \/>\n<meta property=\"article:published_time\" content=\"2013-07-17T16:23:36+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-08-12T12:18:00+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2013\/07\/No-asset-possession.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"289\" \/>\n\t<meta property=\"og:image:height\" content=\"174\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Jack Waymire\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@PaladinRegistry\" \/>\n<meta name=\"twitter:site\" content=\"@PaladinRegistry\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Jack Waymire\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/\",\"url\":\"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/\",\"name\":\"Financial Advisors and Investor Assets - No Possession Allowed!\",\"isPartOf\":{\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2013\/07\/No-asset-possession.jpg\",\"datePublished\":\"2013-07-17T16:23:36+00:00\",\"dateModified\":\"2024-08-12T12:18:00+00:00\",\"author\":{\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/#\/schema\/person\/4f94af521e23212d5ffd08618ecb46c0\"},\"description\":\"We believe that financial advisors and investors should be fully transparent in what they are accountable for.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/#primaryimage\",\"url\":\"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2013\/07\/No-asset-possession.jpg\",\"contentUrl\":\"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2013\/07\/No-asset-possession.jpg\",\"width\":289,\"height\":174},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.paladinregistry.com\/blog\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Advisors\",\"item\":\"https:\/\/www.paladinregistry.com\/blog\/category\/advisors\/\"},{\"@type\":\"ListItem\",\"position\":3,\"name\":\"Weighing In: Financial Advisors and Investor Assets – No Possession Allowed!\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/#website\",\"url\":\"https:\/\/www.paladinregistry.com\/blog\/\",\"name\":\"Paladin Registry Blog\",\"description\":\"Helping You Make Better Financial Decisions\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/www.paladinregistry.com\/blog\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/#\/schema\/person\/4f94af521e23212d5ffd08618ecb46c0\",\"name\":\"Jack Waymire\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.paladinregistry.com\/blog\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2017\/05\/Screen-Shot-2017-05-16-at-8.06.55-AM-96x96.png\",\"contentUrl\":\"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2017\/05\/Screen-Shot-2017-05-16-at-8.06.55-AM-96x96.png\",\"caption\":\"Jack Waymire\"},\"description\":\"Jack Waymire worked in the financial services industry for 28 years before he left to found the Paladin Registry (www.PaladinRegistry.com) in 2004. This investor education website was based on the Principles in Jack\u2019s first book: \\\"Who\u2019s Watching Your Money?\u00a0The 17 Paladin Principles for Selecting a Financial Advisor.\\\" Jack is also the co-author of \\\"5 Steps for Selecting the Best Financial Advisor (How the Internet has changed the game for investors and advisors)\\\". Beginning in 2004,\u00a0Paladin began vetting and documenting advisor credentials, ethics, business practices and services for investors. The Registry also has a free service that matches investors to advisors who meet Paladin\u2019s minimum requirements for competence and trustworthiness.\",\"sameAs\":[\"https:\/\/www.paladinregistry.com\",\"https:\/\/www.facebook.com\/PaladinRegistry\",\"http:\/\/www.linkedin.com\/in\/jackwaymire\",\"https:\/\/x.com\/PaladinRegistry\"],\"url\":\"https:\/\/www.paladinregistry.com\/blog\/author\/jack-waymire\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Financial Advisors and Investor Assets - No Possession Allowed!","description":"We believe that financial advisors and investors should be fully transparent in what they are accountable for.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/","og_locale":"en_US","og_type":"article","og_title":"Financial Advisors and Investor Assets - No Possession Allowed!","og_description":"We believe that financial advisors and investors should be fully transparent in what they are accountable for.","og_url":"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/","og_site_name":"Paladin Registry Blog","article_author":"https:\/\/www.facebook.com\/PaladinRegistry","article_published_time":"2013-07-17T16:23:36+00:00","article_modified_time":"2024-08-12T12:18:00+00:00","og_image":[{"width":289,"height":174,"url":"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2013\/07\/No-asset-possession.jpg","type":"image\/jpeg"}],"author":"Jack Waymire","twitter_card":"summary_large_image","twitter_creator":"@PaladinRegistry","twitter_site":"@PaladinRegistry","twitter_misc":{"Written by":"Jack Waymire","Est. reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/","url":"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/","name":"Financial Advisors and Investor Assets - No Possession Allowed!","isPartOf":{"@id":"https:\/\/www.paladinregistry.com\/blog\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/#primaryimage"},"image":{"@id":"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/#primaryimage"},"thumbnailUrl":"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2013\/07\/No-asset-possession.jpg","datePublished":"2013-07-17T16:23:36+00:00","dateModified":"2024-08-12T12:18:00+00:00","author":{"@id":"https:\/\/www.paladinregistry.com\/blog\/#\/schema\/person\/4f94af521e23212d5ffd08618ecb46c0"},"description":"We believe that financial advisors and investors should be fully transparent in what they are accountable for.","breadcrumb":{"@id":"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/#primaryimage","url":"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2013\/07\/No-asset-possession.jpg","contentUrl":"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2013\/07\/No-asset-possession.jpg","width":289,"height":174},{"@type":"BreadcrumbList","@id":"https:\/\/www.paladinregistry.com\/blog\/advisors\/weighing-in-financial-advisors-and-investor-assets-no-possession-allowed\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.paladinregistry.com\/blog\/"},{"@type":"ListItem","position":2,"name":"Advisors","item":"https:\/\/www.paladinregistry.com\/blog\/category\/advisors\/"},{"@type":"ListItem","position":3,"name":"Weighing In: Financial Advisors and Investor Assets – No Possession Allowed!"}]},{"@type":"WebSite","@id":"https:\/\/www.paladinregistry.com\/blog\/#website","url":"https:\/\/www.paladinregistry.com\/blog\/","name":"Paladin Registry Blog","description":"Helping You Make Better Financial Decisions","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.paladinregistry.com\/blog\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/www.paladinregistry.com\/blog\/#\/schema\/person\/4f94af521e23212d5ffd08618ecb46c0","name":"Jack Waymire","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.paladinregistry.com\/blog\/#\/schema\/person\/image\/","url":"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2017\/05\/Screen-Shot-2017-05-16-at-8.06.55-AM-96x96.png","contentUrl":"https:\/\/www.paladinregistry.com\/blog\/wp-content\/uploads\/2017\/05\/Screen-Shot-2017-05-16-at-8.06.55-AM-96x96.png","caption":"Jack Waymire"},"description":"Jack Waymire worked in the financial services industry for 28 years before he left to found the Paladin Registry (www.PaladinRegistry.com) in 2004. This investor education website was based on the Principles in Jack\u2019s first book: \"Who\u2019s Watching Your Money?\u00a0The 17 Paladin Principles for Selecting a Financial Advisor.\" Jack is also the co-author of \"5 Steps for Selecting the Best Financial Advisor (How the Internet has changed the game for investors and advisors)\". Beginning in 2004,\u00a0Paladin began vetting and documenting advisor credentials, ethics, business practices and services for investors. The Registry also has a free service that matches investors to advisors who meet Paladin\u2019s minimum requirements for competence and trustworthiness.","sameAs":["https:\/\/www.paladinregistry.com","https:\/\/www.facebook.com\/PaladinRegistry","http:\/\/www.linkedin.com\/in\/jackwaymire","https:\/\/x.com\/PaladinRegistry"],"url":"https:\/\/www.paladinregistry.com\/blog\/author\/jack-waymire\/"}]}},"_links":{"self":[{"href":"https:\/\/www.paladinregistry.com\/blog\/wp-json\/wp\/v2\/posts\/1193"}],"collection":[{"href":"https:\/\/www.paladinregistry.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.paladinregistry.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.paladinregistry.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.paladinregistry.com\/blog\/wp-json\/wp\/v2\/comments?post=1193"}],"version-history":[{"count":7,"href":"https:\/\/www.paladinregistry.com\/blog\/wp-json\/wp\/v2\/posts\/1193\/revisions"}],"predecessor-version":[{"id":12696,"href":"https:\/\/www.paladinregistry.com\/blog\/wp-json\/wp\/v2\/posts\/1193\/revisions\/12696"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.paladinregistry.com\/blog\/wp-json\/wp\/v2\/media\/1195"}],"wp:attachment":[{"href":"https:\/\/www.paladinregistry.com\/blog\/wp-json\/wp\/v2\/media?parent=1193"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.paladinregistry.com\/blog\/wp-json\/wp\/v2\/categories?post=1193"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.paladinregistry.com\/blog\/wp-json\/wp\/v2\/tags?post=1193"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}