Member Insights - Help Your Clients Get Serious about Due Diligence

Clients are often a little too nice—and a little too laid back when it comes to hiring a financial advisor.  So says Kelly Shaw, president and CEO of Kelly Shaw Financial Advisors, a member of the Links Asset Management Group, of Temecula, California.  They can be overly trusting and don’t want the hassles of really checking out an advisor, he says, especially if it involves calling the SEC or the NASD.  But Kelly is serious about encouraging prospects to look into his background.  So serious that he applied for admission into the National Ethics Bureau in 2004 and has been a member ever since.

Kelly Shaw NEB Member

Shaw, Senior Market Advisor’s 2005 Producer of the Year, joined NEB because he wanted to give potential clients a way to make sure he was legitimate, to see he was a real entity, and to verify he didn’t have any complaints against him.  “NEB helps people answer those questions,” Shaw says.

However, advisors shouldn’t rely just on the National Ethics Bureau to build their reputations.  They should also join their local Chamber of Commerce and Better Business Bureau, get active in local charitable organizations, and establish an office in the community.  The point is to get connected with organizations and people who can speak about your ethics, integrity, and willingness to serve.

“I tell every client,” says Shaw, “‘don’t take my word for it!  Check me out.  Go on the Internet, Call NEB’s (800) number or visit their web site.  Verify that I’m a member of the Chamber and BBB.  Ask about my charitable work.  See if people know who I am and find out what they have to say about me.’

“I tell them, ‘You should be doing this for every financial advisor you consider.  If someone is coming into your home and doesn’t have a local place of business, no office support, doesn’t belong to the Chamber, BBB, and NEB, and has never been involved in your community, why would you do business with them?’”

Shaw believes in having that conversation at the first client meeting.  He also delivers it at the beginning of his seminars.  Apparently, Shaw’s prospects are not only checking him out, they are happy with what they find.  His firm has been growing steadily over the years.  Focused primarily on senior-market and boomer-market clients, Shaw has more than $20 million under management and sold $11.7 million in annuity premium last year.  He serves 85 clients with an average age of 70 to 72.  And he fully expects to continue growing in the future.

But Shaw hasn’t allowed his growing reputation to go to his head.  He still urges his prospects to confirm who he is.  “If you’re affiliated with an independent firm, not a Smith Barney, it’s even more important to help people realize you are legitimate.  You need to give them someplace to go to verify your industry background.  National Ethics Bureau is a great first step.”

How are you maximizing your NEB membership to grow your business? Would you like to be featured in our newsletter? The National Ethics Bureau welcomes your input. Send your comments to: hlew@ethicscheck.com