First complaint

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Jan 3, 2009 10:10 pm

I cannot believe I got my first client complaint in my 9 year in the business.  After placing the client into the founding father strategy late 07 and saw the value dropped about 20 percent.  He liquidated the fund in july of this year before the big crash and now this idiot thought it was a guarantee investment.  Got the complaint letter 5 month after the liquidation.  Everyone want a guarantee 20 percent return with no downside.  Anyone else have experienced anything similar this year?

Jan 4, 2009 10:53 am

Nope. Everything I do is guaranteed. Have never had a complaint. Knock on wood. 

Jan 4, 2009 11:17 am
skbroker:

I cannot believe I got my first client complaint in my 9 year in the business.  After placing the client into the founding father strategy late 07 and saw the value dropped about 20 percent.  He liquidated the fund in july of this year before the big crash and now this idiot thought it was a guarantee investment.  Got the complaint letter 5 month after the liquidation.  Everyone want a guarantee 20 percent return with no downside.  Anyone else have experienced anything similar this year?

 
That collection of funds is going to bite a lot of people. I know that Franklin Templeton surged when I was at Jones, based on that strategy alone.. "past performance...."
Jan 4, 2009 2:41 pm

Yes.  Remember to document.  Documentation is what saves you.

Jan 6, 2009 5:21 pm

good client notes, proper suitability, and disclosure will help squash this.

 
in the future consider recomending a VA with guarantees
Jan 6, 2009 10:26 pm

Funny what clients remember or don't remember!

Jan 7, 2009 10:53 am
jkl1v1n6:

Funny what clients remember or don't remember!

 
Even funnier is what they fabricate!
Jan 8, 2009 11:08 pm
Hank Moody:

Nope. Everything I do is guaranteed. Have never had a complaint. Knock on wood. 


Sweet CD's and FDIC insured deposits that is a cool strategy lol!

Jan 9, 2009 5:30 pm

I'm afraid there are plenty of us who've been around for a while who will get tagged with a complaint for the first time in 09'. Cycles like this will do that. I had the same issue 9 years ago, cleared, but it took 6 months off my life. Document the heck out of everything you do. A good BOM and compliance relationships don't hurt either. 

Jan 15, 2009 11:22 pm
iceco1d:

nestegg...you don't pay much attention to this forum do you?


Sure I do...he said guaranteed...and those are the only 2 products that are :)

Jan 15, 2009 11:41 pm

I am getting little sick of retail clients

Jan 19, 2009 9:40 pm

Be sure to keep a personal file with a copy of everything. Complaint letter, firms response, your response, etc..



Even if it in non-disclosable you want to keep a copy of everything in case you ever want to make a move.

Jan 22, 2009 10:49 am

I agree with ABOM--that really helps!  I got my first one when I had 15 years in the business and it was over suitability...and the trades were made at another firm before I moved!  Client specks--client had 3 million AUM with various firms--income over 215,000 a year and he was retired...wanted AAA rated zero coupon muni bonds yielding +4.5%...discussed with him his investments--time--estate--taxes--and income needs.  Based on this we bought $250,000 of the muni zeros over a 4 month period.  AMBAC has problems and hedge fund managers + mutual fund managers flood market with muni's.  Value drops like a rock--files complaint with former firm--I get it directly to me--I answer and explain my actions--former firm backs me up--FINRA questions same trades--reviews my submission and takes no further action...former client is not happy and calls my office daily for a two month period and drops off the face of the earth 8 months ago.  It did comsume my life for a short period of time too--but no matter how safe the investment/how much you do to make sure it is the right investment/ect...you can still get this on your record.  It is still part of my U-4 no matter what because of the $$$$$ figure...This is bull crap!

Jan 22, 2009 3:28 pm
skbroker:

I cannot believe I got my first client complaint in my 9 year in the business.  After placing the client into the founding father strategy late 07 and saw the value dropped about 20 percent.  He liquidated the fund in july of this year before the big crash and now this idiot thought it was a guarantee investment.  Got the complaint letter 5 month after the liquidation.  Everyone want a guarantee 20 percent return with no downside.  Anyone else have experienced anything similar this year?



Did you ask him which part of the investment he thought was guaranteed (i.e. principal or return or both)?  I think it matters cause you'd want to find out what he thinks guaranteed investment means so you can find out what he thought he was buying (i.e. CD, VA, FA, etc.) and address the issue from there.  How much is his net worth?  Does he have prior investment experience?  Is he a knowledgeable investor?  But, yeah, get your client files in order.

Jan 23, 2009 8:23 pm

skbo



dont live in fear over it.   face it head on.    



review the facts.



anyone can say anything they want.



we get so paranoid in this business.



f-em

Mar 24, 2009 5:37 pm
skbroker:

I cannot believe I got my first client complaint in my 9 year in the business.  After placing the client into the founding father strategy late 07 and saw the value dropped about 20 percent.  He liquidated the fund in july of this year before the big crash and now this idiot thought it was a guarantee investment.  Got the complaint letter 5 month after the liquidation.  Everyone want a guarantee 20 percent return with no downside.  Anyone else have experienced anything similar this year?



From a compliance prospective you should have good notes on the client, an IPS, and qualification documentation.  Additionally make sure none of your marketing material, agreements, website even mention the word guarantee.  If you do not have a good documentation process when speaking to clients ( I know it takes time) try using a dictation software like Dragon Naturally Speaking. It is $99 and works well.  I ask all my clients to use it.  They all love it as you can dictate a two minute note about a conversation and place in the client file.  It will not help you with this case, but for the future.

ash
www.FAfreedom.com - The Breakaway Experts

Mar 29, 2009 8:59 pm

Having just been confronted with a SURPRISE audit, make sure you have a file folder to put complaints in -- even if you don't have any complaints.