A common concern is “How does Madoff not happen to me?”  Power without accountability isn’t necessarily a good thing.  Often, layers of transparency subject to the review of others can be healthy to protect your objective, whatever it may be.

  • Financial decisions should be able to withstand the scrutiny of other eyes, beyond a person’s financial advisors. For example, trustees, CPAs or attorneys, typically seek a person’s best interest. If informed and astute, they can provide a healthy balancing perspective.
  • In the same way, when an investment relationship is established, a check or asset transfer should be executed with a known custodian.  A custodian, as defined by Investopedia, is “a financial institution that holds customers’ securities for safekeeping so as to minimize the risk of their theft or loss.  A custodian holds securities and other assets in electronic or physical form. Since they are responsible for the safety of assets and securities that may be worth hundreds of millions or even billions of dollars, custodians generally tend to be large and reputable firms.”  Custodians are also subject to multiple layers of regulatory oversight and transparency. A check or asset transfer to the name of an individual or a company not subject to those layers may not be a productive move.
  • Today records and credentials regarding financial advisors are readily available online such as FINRA’s BrokerCheck.

These ideas may be helpful in making informed investment decisions.