Red Flag Clients

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Mar 12, 2007 8:20 am

I am new to a community bank investment program.  Am the only advisor there, taking over a book of @10 mil from the old rep they let go.  I am their 3rd rep in 3 yrs.


I am slowly finding out that this is not my business, i.e., there are lots of variables I didn't think through before I got into this.


One of the biggest of these is that I am not free to work with who I want.  Most of the people I have met with from the existing book have been great, and they are eager to work with me, and me with them.  I had an exception to that last week with a woman I can only describe as one GIANT red flag.  There was an appt. mix-up that I won't go into, but she went into a tirade, went running the the bank President (who wasn't there), then to Lending, where she has an account screaming to them.  I had never met the woman before she walked in the door, and literally spent 2 minutes with her in my office introducing myself, apologizing for the appt. mix-up when she told me she was moving her account.  I was flabbergasted, but told her I was sorry, but would help in whatever way I could.


Well, long story short, Lending brought her to my Mgr, who told her how great I was and to give me a chance.  My Mgr. came to me and asked me to book another appt, and I told her I really was unsure about working with this woman, that she appeared to be a loose cannon.  My Mgr. said that she would sit in on the meeting, which is the only way I would agree to an appt.


This, obviously, is not the way to start a relationship.  If the woman thinks she can run to the bank management anytime she feels put out, or whatever, it does not set the right tone.  I'm surprised the bank interferes like this, but then, it's a big Lending client.  I also am extremely worried that she lied about several things - nothing material - but straight out lies.  This is NOT someone I want as a client.  Again, GIANT red flag.


I have a clean record and want to keep it that way.  When I talked to the bank management after this incident, they simply said I'd have to deal with unreasonable people from time to time.  To me this is not unreasonable - that I can deal with - this is dangerous, and puts me at risk.


I don't know if it is because the bank doesn't understand our business and how complaints work - that no matter how unfounded, someone's record can be ruined, or they just don't care and are putting their interests before mine. 


Have others in bank programs experienced this?  Other than documenting everything, making the woman sign everything, and having my Mgr. sit in on every meeting, is there anything else I can do?  If this were MY business, I would nicely tell this woman to take a hike.  My feeling is there is so much you can't control in this business, you should control the things you can, like taking on dangerous clients.




Mar 12, 2007 9:12 am

Its always beneficial for both the client and yourself to document everything.  As time passes, it will help you both remember what transpired and was discussed. 


I wouldn't say that this was an unusual situation though.  Whenever dealing with a service, there are always going to be clients that are more difficult than others.  And some you even describe as obnoxious and "crazy".  That's what happens when you're in a service industry.  Per your post and don't take this as a negative, I'm just trying to get more information, is this your first job?  Or your first job in a service industry? 


If you work for yourself (indy), you'll have the opportunity to say whether or not you want to work with a particular client, for whatever reason.  However, whenever working for someone else (a bank, wirehouse, etc), you'll have to work with whoever comes across your desk.  Some of those clients you may like, some you may not and even cringe when they stop in or call.  But that's what happens when you work in a service industry.  With time you'll learn how to deal with different people.  There may even, eventually, be people that you once deemed difficult that you can easily work with after awhile.  You'll learn how to manage them.  Who knows maybe she was just having a bad day or you were or whatever. 

Mar 12, 2007 9:43 am

If you work for a wirehouse you can also send a client packing if you wish, and usually with very little interference from management as long as you are a proven producer.

Perhaps on a bank platform this is a little more difficult.  I do not know, as I have no experience in such matters.  Maybe others can chime in on this.

I find it interesting that tri$mom is opining on this matter, especially as regards the finer distinctions between the various channels.  I thought you had no experience in this industry?

Mar 12, 2007 11:27 am

No, this is not my first job, nor is it my first in the service industry.  I have been working for over 30 years, most all of it in service, and in this biz 9 years at a wirehouse.  As mentioned above, at a wirehouse, I could take who I wanted as a client.


Of course I realize people are different and difficult.  I'm not naive.  I also realize this industry is filled with landmines, and why not avoid them when you can??


I don't care if I have someone difficult, demanding, obnoxious - I can deal with that.  What I have a more difficult time dealing with is someone who runs to management if they have a problem or concern, instead of dealing with me, and who at the slightest provocation - or none at all in this case - will lie.  Does not set a good tone. 


We all know that in this industry, a complaint is a complaint is a complaint, no matter how unfounded, and I am not inclined to let some screwball ruin a spotless record.  Yes, I document everything with clients - all of them.  But in this case it seems extraordinary means are necessary - sign-off on everything, Summary letters of every visit, signed off.  Someone in the room as a witness.


I wish the bank would step aside and realize there are dangerous clients, and it's in no one's interest to take them on.  Perhaps this is not the way banks operate, given there are ties to other depts within the bank that are high margin like lending.


I'm just trying to look out for my interests, where I feel they are being overlooked in favor of profitability in other areas. 



Mar 12, 2007 12:02 pm

NR, your positioned is well-reasoned and I don't blame you one bit for feeling as you do.  I fortunately did not experience the same when I was in a bank program, although I think I turned down a total of 2-3 otherwise qualified clients because I saw potential problems coming (unrealistic expectations, name-dropping, etc.), but I can tell you that I never got any interference on this from my bank president.  He trusted me to run the program and was as supportive as any boss I ever had.  It was only when we went through some consolidation and my new bosses were in another town that I felt differently.  Even then, no one ever told me that I had to take everyone that walked in the door.


It sounds like your bank management is clueless to the fact that good lending clients often don't make good investment clients for obvious reasons.  Hope and pray that this client DOES move her accounts.  Until then, I would be as "busy" as I could possibly be with other clients.  If she calls, I would wait until the following day to call her back and apologize for being so "busy".  Have your assistant book her appointments AT LEAST a week out from when she calls since you're so "busy".  If she complains, empathize and suggest that she might be better served with another advisor who has the time to give her the attention she deserves.  One of two things will happen...she'll either settle down or she'll move.  Be polite and helpful, but be firm.  You have other clients who need attention also and if she feels like you are not giving her the attention she deserves, then tell her that you'll understand if she seeks a more suitable advisor.  Your manager is protecting other areas of the bank at your expense.  It's unfortunate, but it is what it is.  Being busy is probably your best defense...so get busy!

Mar 12, 2007 1:37 pm

You are on the right track.  Don't take on liabilities

Mar 12, 2007 3:05 pm

Trust your gut.  Let your manager become her rep if he's insisting on the meeting. 

Mar 12, 2007 7:06 pm
joedabrkr:


I find it interesting that tri$mom is opining on this matter, especially as regards the finer distinctions between the various channels.  I thought you had no experience in this industry?


You're right Joe I don't have as much experience in this industry as you.  Since I originally posted, I've contacted a few local FAs and have started working part-time, mostly from home while my kids are napping or before they're up, for an FA.  Mostly paperwork, so he can concentrate on marketing and referrals, but it gets me some experience and I have someone to bounce ideas and questions off of.  I've also started studying for the CFP. 


However, his post wasn't specific to being an FA.  His first line states that he's the 3rd person in this position in 3 years.  If I was this woman I might be ticked too that here was someone new AGAIN managing my money, especially if I thought they were late for an appointment, regardless of whether or not that was true.  And yes, I'd probably go to management with that concern.  There are a lot of unknowns in his original post.  And if this woman had a multi-million dollar account, the tune would probably be different.  Its all percetion.  And that's part of this industry and any service industry.  You sometimes have to deal with people you just don't like!  And if he didn't like the way that management handled it, then speak up!  Ask your manager how you can deal with these types of situations in the future. 

Mar 12, 2007 7:16 pm
tri$mom:
joedabrkr:


I find it interesting that tri$mom is opining on this matter, especially as regards the finer distinctions between the various channels.  I thought you had no experience in this industry?


You're right Joe I don't have as much experience in this industry as you.  Since I originally posted, I've contacted a few local FAs and have started working part-time, mostly from home while my kids are napping or before they're up, for an FA.  Mostly paperwork, so he can concentrate on marketing and referrals, but it gets me some experience and I have someone to bounce ideas and questions off of.  I've also started studying for the CFP. 


However, his post wasn't specific to being an FA.  His first line states that he's the 3rd person in this position in 3 years.  If I was this woman I might be ticked too that here was someone new AGAIN managing my money, especially if I thought they were late for an appointment, regardless of whether or not that was true.  And yes, I'd probably go to management with that concern.  There are a lot of unknowns in his original post.  And if this woman had a multi-million dollar account, the tune would probably be different.  Its all percetion.  And that's part of this industry and any service industry.  You sometimes have to deal with people you just don't like!  And if he didn't like the way that management handled it, then speak up!  Ask your manager how you can deal with these types of situations in the future. 



I didn't catch the part about him being the 3rd advisor in that position in 3 years.  That's a good point.  Sadly, many bank programs have this problem with high turnover.

Mar 12, 2007 7:44 pm

If your hands are tied, in being forced to deal with this client, be sure to only place their money in VERY conservative investments.


Trust me, you don't want this client receiving a statement showing account totals that are down 10, 20, 30%!


If this client is this upset over a botched appointment, imagine what they'd do over losing money! Hopefully, they don't carry a gun.


 

Mar 12, 2007 10:15 pm

No, if this were a multi-million dollar client, the tune would NOT be different.  I operate the same for every client.  Some would say stupid, but I play by the book, and protect myself the same whether someone has 1K or 10 million.


When you start bending the rules for the big clients, and not listening to your gut because they have lots of money, that's when the trouble starts.  I've seen it with lots of reps, and I don't want to be there.


I did speak with my Mgr. this AM, and she was very supportive.  Said she would sit in on my meeting, and if I still did not feel comfortable, them I could say NO.    I like the "busy" idea - I think from Indyone, but could she then file a complaint about that, and would that go on my record?  I don't know how all this complaint stuff works other than what's reportable, and a written complaint I know is.


I plan to tread VERY carefully here, and let this woman know I may not be able to meet her expectations, etc.  I'm sure she's upset I didn't grovel when she said she was leaving.  Inside I was jumping for joy....


Thanks for the suggestions. 


p.s.  My thought is to do nothing but unsolicited trades with her.  Unfortunately, I cannot trust someone who has lied about me.


Mar 12, 2007 10:33 pm

It sounds to me like you're on the right track.

No I doubt she can file any sort of complaint against you for being too busy.  Nothing that will stick.  She'll just be laughed at.

Mar 12, 2007 10:56 pm

The reality in most bank programs is that you are there to "service" their important customers.  If you happen to make money while doing so, that's great.  Banks, especially smaller ones, are a lot more concerned with a $1 million loan customer than they are with a $1 million investment customer.  I would hesitate to give too much push back on these types of situations.  You may see your referral streams dry up.

Mar 12, 2007 11:58 pm

I guess this is one of the problems with working for a bank.  Not to be critical of bank folks, it's just that I never of thought of this issue until I read the original post.


My suspicion is that the lenders don't like her very much either and it may be worthwhile for you to speak with them about their dealings with her. 


If you really are stuck with her then I recommend that you document everything and keep her in things like CDs and money markets.  Also, you certainly want your manager in on any meetings.  Make sure that you keep your manager posted about any phone calls or e-mails that are even far short of the standard for a complaint.


If things continue to go badly, then I recommend that you discuss the process of firing her with your manager.


I formally fired (i.e., drafted a letter and stated that they had 30 days to move their accounts) my first client last year and it really helped that I'd discussed the situation with my manager.   Naturally, the client called and complained to the manager upon receipt of the letter from me.  The fact that I kept my manager in the loop as to what an idiot this client is made it easy to resolve.  My only regret is that I didn't fire the client sooner.

Mar 13, 2007 6:04 am

BACFA -


Yes, I now realize I am expected to "service" all the bank customers, whether they have money or not, whether I make money or not.


However, letting someone ruin my spotless record is where I draw the line....  If it stops the referrals, so be it.  There are other places to work.  It's easier to find a new job than to recover from a damaged U4.

Mar 13, 2007 9:48 am
rrbdlawyer:

While I can share the client's upset about someone missing an appointment (and "yes" lawyers are often guilty of that situation too--hey, as you note, it happens), her response seems disproportionate and indicates a predisposition to such reactions.  Imagine whay may happen if she feels she's being overcharged on a fee or commission, or an investment you recommend doesn't perform well, etc.



To me that is the KEY point in this whole matter.  This business is stressful enough without dealing with clients who are predisposed to picking fights.

Mar 13, 2007 10:25 am

Come on! Give the lady a break! Fercryin out loud this is what? the third or fourth knucklehead (in her mind) that she's seen across the desk in the past 3 years? Not to mention the blank space between times when they didn't have anybody sitting there. <?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />


Why should she show this new guy any respect at all? (I don't mean to denigrate the poster, I'm just trying to visualize it from the customers POV). She's not really as mad at the guy across the desk as she is at the bank for their incompetent practices that have lead her to ZERO consistency with her assets (which, BTW she may well feel are being held hostage by the bank just so she can borrow money at favorable rates even though it means giving up 10 percentage points of performance (or even losing her money) to save 1.125% on her loan portfolio.


If I were her I'd be cheesed off too. Granted, I have a low tolerance to ineptitude and have been known to leave more than one restaurant in a huff, but this situation is the situation that this guy signed on to.


There are probably a lot of existing clients who are not happy with circumstances there and even less happy that they feel as though they don't have options. You take over a position, it's not all beer and skittles (whatever that means). You're going to be judged as just like the last three morons that sat in your seat and it's going to take you at least three years to erase the memory of that stink from your chair.


Mar 13, 2007 5:46 pm

I appreciate all the posts and comments.


Let me just clear up a few things for the last poster...


Yes, the bank made some poor (or what turned out to be poor) hiring decisions.  It happens.  There was no lapse in coverage however.  Someone was in the seat the day after the old producer left.


I can understand someone not liking the situation - they can be skeptical, distrustful, move their account elsewhere if they really aren't the type to give someone a chance.  There's no being held hostage.  We don't give someone discounted loan rates if they have their investment account with us.


The fact that the woman blatantly lied is the issue - not about one thing - but about several.  That to me shows someone not just unhappy, but unbalanced.  And it's water under the bridge now, but it was the woman herself who screwed up the appt.  She didn't HAVE one.  She was given 2 available times, and told to call by my asst., and just decided to show up.  I graciously dropped everything I was working on and told her no problem, I'd be happy to meet with her.


To rrbblawyer thank you for posting.  I see many of your posts, and have great respects for your work.  I hope never to have to need your services, though:-)  I am not saying clients shouldn't have someone to go to if they are unhappy I was just saying it is hard in a bank, because there are lots of interests at stake other than the broker's.  They want to keep this woman because if she moves her investment account, then the new firm will solicit her lending business, and they don't want to lose that.  The bank doesn't understand the nitty gritty of our business, so it is hard for them to understand the liability involved in keeping someone questionable, and sadly, there's only so much you can do to protect yourself....


Mar 13, 2007 6:28 pm
Whomitmayconcer:

Come
on! Give the lady a break! Fercryin out loud this is what? the third or
fourth knucklehead (in her mind) that she's seen across the desk in the
past 3 years? Not to mention the blank space between times when they
didn't have anybody sitting there.





I don't think alot the people in this thread fully understand that securities is not a core operation for the bank. If you annoy depositors/borrowers it is your ass on the line.



You don't know this persons history, and for sure you will never win an
argument with a customer. So sit back, listen quietly Under no
circumstances tell the other person they are wrong. Get them to say yes
to something, anything! t o break the negativity. And try very hard to
see things from the other point of view.



As for ingratitude, Remember that in the new testament, Dr Julius Erving healed 13 people, and not a single one thanked him. You cannot expect to do better.



Treat this person with respect and try to see them in perfected form, as an ideal client. If I was your boss, I would be very annoyed
if  instead of making a sincere effort to  save the
relationship you tried to make a customer go away with bad service.






Mar 13, 2007 6:33 pm
newrookie:

BACFA -


Yes, I now realize I am expected to "service" all the bank
customers, whether they have money or not, whether I make money or not.


However, letting someone ruin my spotless record is where I draw the
line....  If it stops the referrals, so be it.  There are
other places to work.  It's easier to find a new job than to
recover from a damaged U4.





Only now you realise that that bank brokers are expected to take on all comers.



If you try to brush this customer off with bad service, you are running
a very real risk of damaging your U-4. Depending on how much heat this
person raises, you could get into more serious trouble. Getting fired
from a bank program for cause, is not impressive.



If you follow other people