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May 21, 2012
Mark Clayton: Cybersecurity: How US utilities passed up chance to protect their networks
Howard LaFranchi: NATO summit: Who will foot the bill for long-term Afghanistan security?
Chris Farrell : Earn Dividends in Emerging Markets with This WisdomTree ETF
Stephen Whiteside, Ph.D. : Mayo Clinic Medical Edge: Social anxiety disorder --- or just shy?
Guy Jackson : Victim's father regrets death of Lockerbie bomber
The Kosher Gourmet by Mario Batali: Famed chef's veal shoulder farsumagru: A festive meat course for late spring
May 18, 2012
Rabbi Berel Wein: Striving: The People of the Book's Book for (All of) the People
Steven Goldberg: 5 Great Stock Picks and the Exchange-Traded Fund that Owns Them
Mary Pickett, M.D.: Ask the Harvard Experts: Don't be forced into gluten-free lifestyle based merely on a doctor's false-positive test
The Kosher Gourmet by Carolyn Malcoun: DIY healthy lunchbox treats: HOMEMADE FRUIT BARS for kids and brown-bagging adults alike
May 17, 2012
Warren Richey: Teacher fired for being unwed and pregnant can sue religious school, court rules
Josh Mitnick: Netanyahu's 'centrist' coalition is already proving it's anything but
Steven Goldberg: Earn Dividends in Emerging Markets with This WisdomTree ETF
Amina Khan: Research links coffee to lower death rates
The Kosher Gourmet by Faith Duran : Cheesy Potato Breakfast Casserole with Cheddar and Sun-Dried Tomatoes
May 16, 2012
Carmen Terzic, M.D., Ph.D. : Mayo Clinic Medical Edge: A variety of exercises can help improve balance
Melissa Healy: National strategy on Alzheimer's disease aims to halt it by 2025
The Kosher Gourmet by Joyce White : GOODNESS GRACIOUS: GREENS! 4 winning recipes that are no longer just for down-home folks (Includes expert tips & techniques)
May 15, 2012
Kristen Chick: Obama administration resumes arms sales to Bahrain despite serious unresolved human rights issues. Activists feel abandoned
Pat Mertz Esswein: Homes are now affordable again and mortgage rates are low. What you need to know before you buy
Kathy Kristof: Our Practical Investor Fights Inflation with These 6 Investments
Sue Hubbard, M.D.: The Kid's Doctor: Lactose intolerant young child? Check again
The Kosher Gourmet by Kathy Hunt: Spread a Little Excitement with EXOTIC CONDIMENTS (4 RECIPES)
May 14, 2012
Lisa Gerstner: How to Protect Your Identity, Finances If You Lose Your Phone
Harvard Health Letters: Heart disease and dementia
The Kosher Gourmet by Megan Gordon: MANGO COCONUT OAT MORNING MUFFINS are a bright but hearty delight
May 11, 2012
Jessica L. Anderson: Get the Best Deal on a Used Car
Jett Stone: Forget face-lifts and fake knees. Scientists have seen the fountain of youth --- and it's broccoli
The Kosher Gourmet by Chef Mario Batali: The famed chef's vegetable dish that tastes true to the season: FAVAS AND SUGAR SNAP PEAS WITH POTATOES AND TARRAGON
May 10, 2012
Sergei L. Loiko: Putin sends warning to U.S., NATO in Victory Day speech at Red Square
Mary Rourke: How being a 'mentch' got Vidal Sasoon his start and fighting in Israel's War of Independence provided him with confidence and a strong sense of his own identity
Jeff Bertolucci: Get Home Phone Service for Less Than $10 a Month
The Kosher Gourmet by Betty Rosbottom: Gleaming with its golden, crimson, and snowy white hues, this silken smooth and creamy STRAWBERRY ORANGE TRIFLE looks impressive, but is easy to prepare
May 9, 2012
Sharon Palmer, R.D. How you can reduce your risk -- or delay -- chronic diseases associated with aging
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Jewish World Review
Awkward Questions You Must Ask Your Financial Adviser
By
Rachel Koning Beals
Put brokers, financial planners, and asset managers on the spot
JewishWorldReview.com | (USNWR)
Ask investment professionals questions that creep into uncomfortable territory and you'll be glad you did. Go ahead and say it: "How do I know you won't steal my money or defraud me?" How quickly and sincerely do they answer such a question?
In the wake of well-publicized frauds by Bernie Madoff and Allen Stanford, investors have expressed alarm and distrust, but many still take little action at the outset to make sure they're working with a professional they not only trust with their life savings, but that they genuinely like.
The Madoff case involved high net-worth and even famous clients who largely relied on word-of-mouth recommendations without running their own checks. That's a tough lesson that translates to all investors no matter the size of their nest egg. Of course, the tragedy of fraud is that sometimes even the most respectable of financial professionals can fall from grace and fail their loyal clients. Investors are also relying on regulators to do their jobs.
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Claiming ignorance is not an excuse for skipping your homework. "It's the information age, but you'd be surprised at how little average investors use even basic Internet searches to pre-screen investment professionals," says Randy Shain, author of Hedge Fund Due Diligence and founder of BackTrack Reports, a New York-based firm that specializes in investigating the backgrounds of hedge funds, private equity investors, and financial services professionals.
Many of the early screening questions investors should be asking financial professionals, and themselves, fall under the "common sense" category. Yet that doesn't guarantee that investors are doing the asking.
1. Ask the manager to explain his or her strategy. If the explanation sounds too complicated or the manager can't explain it in layman's terms, be wary.
2. Get to know the manager and his or her personality before you commit.
3. Ask for a resume and even consider calling former employers to ensure accuracy. (Yes, you are allowed to do this.)
4. Ask whether the professional tends to work with people your age and at your income level.
5. Ask whether there have been regulatory inquiries into the individual or the firm, noting that if they fudge the truth, you will be able to check. This can be a good measure of honesty very early in the process.
6. Ask if the firm will cover fraudulent or even unethical actions by an individual it employs.
And the biggie, which you should ask yourself: Do these returns or other benefits sound too good to be true? Investors get caught up in marketing materials that show track records. But they may not ask the tougher questions of a manager or advisor: What's the negative scenario? What's the chance the worst will happen?
Knowing the experience level of your financial professional is important. During the boom real estate and credit years earlier this decade, some professionals were chasing new licenses with haste, combining a mortgage business with insurance and general financial planning. On top of that, some professionals operating under the broad umbrella of "financial services" even snagged a real estate license and were showing and selling homes. Some professionals can handle it, but others spread themselves too thin.
"The reality is there's not such a huge barrier to entry to financial services," says Shain. The barrier then lies with you and your decision to let a particular professional handle your money.
Three agencies are a good starting point for screening: the
Financial Industry Regulatory Authority
(FINRA), the
Securities and Exchange Commission
(SEC), and the
National Futures Association
(NFA).
To check the background of a broker, use FINRA's BrokerCheck or call (800) 289-9999. For an investment adviser, use the SEC's Investment Adviser Public Disclosure website.
You may also opt to call your state securities regulator. Contact the
North American Securities Administrators Association
at 202-737-0900.
To check out investments, ask first: Is this investment registered with the SEC or with my state securities regulator? Use the
SEC's EDGAR database of company filings or call your state securities regulator.
Also check out NFA's
Background Affiliation Status Information Center
, or BASIC.
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© 2012, U.S.News & World Report LP All rights reserved. Distributed by Tribune Media Services
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