What is wrong with some advisors?

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Oct 10, 2009 3:46 pm

One of my former clients, Just got into the office to call a few folks and called this client.

After being let go at UBS in April, went overseas for a few months. One of my clients didnt contact my old office, but found a new guy who was at their work....

the client was my mom's friend. her old advisor at a bank stuck her into B shares, so when we transfered things over, we just left them in those. the new advisor a prudential insurance agent, recommended the client liquidate the account, get hit with the B-share charges (around 4%), and moved the proceeds into a variable annuity with a 7% bonus.

Not only did she take the hit up front for the cash, the new guy stuck her into a 10 year VA, without even explaining to her she will be hit with charges or the new annuity surrender schedule.

Meeting with client again on Monday, as now I am working Indy.

Should the client file a complaint against the prudential guy? She sold the funds in July, so would of actually been up quite a bit more, or should I just do a change of broker/dealer on the va and get on with life?

Oct 10, 2009 3:54 pm
aeromaks:

One of my former clients, Just got into the office to call a few folks and called this client.

After being let go at UBS in April, went overseas for a few months. One of my clients didnt contact my old office, but found a new guy who was at their work....

the client was my mom's friend. her old advisor at a bank stuck her into B shares, so when we transfered things over, we just left them in those. the new advisor a prudential insurance agent, recommended the client liquidate the account, get hit with the B-share charges (around 4%), and moved the proceeds into a variable annuity with a 7% bonus.

Not only did she take the hit up front for the cash, the new guy stuck her into a 10 year VA, without even explaining to her she will be hit with charges or the new annuity surrender schedule.

Meeting with client again on Monday, as now I am working Indy.

Should the client file a complaint against the prudential guy? She sold the funds in July, so would of actually been up quite a bit more, or should I just do a change of broker/dealer on the va and get on with life?





Did she sign a switch letter?

Oct 10, 2009 3:55 pm

Let me guess... you're just bitter because you didn't think of this first?

 
1)  Does the new VA meet the client's WANTS?  Do they want the additional protection available through the VA, understand the living benefit (which should be there) and understand the new cost structure for the new account?
 
2)  Didn't the 7% bonus help to recover the 4% CDSC and some of the market losses in the unprotected B-shares?  Therefore while it all should have been disclosed to the client, didn't the client "net" out better for going into this transaction?
 
So it's a 10 year VA.  I think you're just bitter because now you can't collect an ongoing fee trail.
 
If she were to complain, what would she complain about?  The compliance officer of the old firm would look at the facts (probably as I just laid them out) and would ask what the problem was?  Even if everthing wasn't SAID, I'm sure the paperwork is complete and the client is in a better position.
 
I would determine what the new M&E charges are, rider charges and any other charges on the new product.  If they total more than 3.5%, then you may want to pursue futher.
 
You're not going to get paid again and you're not going to her to move the funds and pay another surrender charge.  I would just do the agent change and keep her happy.
 
But that's just me.
Oct 10, 2009 7:11 pm

Client brought in a statement the other day: 70 years old, used to be worth $400k, now worth $70k. Client is going back to work, what a bad year for him don't you think?

Oct 10, 2009 9:28 pm

Mr. Blonde,

 
How does that apply to this thread?  I don't get it.
Oct 10, 2009 9:58 pm

What is wrong with some advisors= Client loses over 75% of his portfolio and is 70 years old and from what I could tell from the 1 hour meeting, very little investment experience and from his account was relying on the advisor's advice

Oct 10, 2009 10:10 pm

WTF was he invested in that lost 75%?  Maybe he was drawing off of the account to pay for retirement bills and managed his budget very poorly??

Oct 10, 2009 10:24 pm

Income trusts, resource funds, a bunch of small caps I've never heard of, the entire thing. He was pulling money, $2k per month he said. I gave him a list of questions to ask his broker but he is exploring his options.

Oct 11, 2009 11:41 pm

Especially one that is now VERY leery of advisors.

Oct 12, 2009 12:47 am
Mr.Blonde:

Income trusts, resource funds, a bunch of small caps I've never heard of, the entire thing. He was pulling money, $2k per month he said. I gave him a list of questions to ask his broker but he is exploring his options.


Never said I took it, english isn't your first language is it.
Oct 20, 2009 10:57 pm

One of my former clients, Just got into the office to call a few folks and called this client.

After being let go at UBS in April, went overseas for a few
months. One of my clients didnt contact my old office, but found a new
guy who was at their work....

the client was my mom's friend. her
old advisor at a bank stuck her into B shares, so when we transfered
things over, we just left them in those.  the toronto asian escort new advisor a prudential
insurance agent, recommended the client liquidate the account, get hit
with the B-share toronto escort charges (around 4%), and moved the proceeds into a
variable annuity with a 7% bonus.

Not only did she take the hit
up front for the cash, the new guy stuck her into a 10 year VA, without
even explaining to her she will be toronto asian escorts hit with charges or the new annuity
surrender schedule.

Meeting with client again on Monday, as toronto escorts now I am working Indy.  

Should
the client file a complaint against the prudential guy?  She sold the
funds in July, so would of actually been up quite a bit more, or should
I just do a change of broker/dealer on the va and get on with life?