SACRAMENTO, Calif., Dec. 11, 2007 — In a recent study that included responses from more than 4,000 consumers, Paladin found 83.7% of the people who use the services of financial advisors and planners do not know how to determine their actual levels of competence and integrity. Further research showed the financial industry deliberately withholds this information from consumers so poorly qualified advisors and sales representatives can sell them investment and insurance products.
Jack Waymire, co-founder of the Paladin Registry and author of "Who's Watching Your Money?" (ISBN 0471476994, John Wiley & Sons, 2003), said, "Financial advisors don't have audited track records that document their results. At the same time industry lobbyists make sure there are no mandatory disclosure requirements for advisors or planners. This means consumers have to develop their own methods for determining the competence and ethics of advisors before they hire them or buy products from them."
Waymire suggested a solution: "Paladin professionals have spent more than 30 years studying the relationships between consumers and advisors. Plus, we have conducted more than 50 studies to determine how consumers select financial professionals and why so many terminate their advisors within two years. We used this experience and data to develop a proprietary system for rating 17 key points of information that impact the competence, ethics, and business practices of financial planners and advisors. The rating is expressed in stars. For example, a five-star rating signifies the highest-quality advisor."
When asked how advisors responded to the rating service, Waymire observed, "It's been our experience that only the highest-quality advisors are willing to provide rating data. Lower-quality advisors resist ratings because they don't want consumers to know their weaknesses. Their concern is valid. 88% of consumers in a study group said if they knew the advisors' quality ratings in advance, they wouldn't buy advice or products from those with lower ratings. This explains why the industry spends so much time and money fighting mandatory disclosure."
Some of the Paladin Registry's 17 key rating criteria include education, experience, certifications, association memberships, firm or team affiliations, licensing and registration, compliance record, criminal record, fiduciary status, method of compensation, scope of current business, and wealth management services. An evaluation of these advisor characteristics by Paladin experts results in six ratings that range from none to five stars. The top 7% of advisors, who receive five-star ratings, are profiled in its Registry (http://www.paladinregistry.com). Finding a five-star advisor in your community is a free public service.
About Paladin Registry
Founded in 2003, Paladin is an information services company that provides free public services to consumers who use the services of financial advisors and planners. The Registry educates consumers about financial professionals and provides ratings and documentation for criteria that impact their competence and integrity. You can learn more about Registry services by going to http://www.paladinregistry.com.
Media Contact:
Jack Waymire
Paladin Registry Inc.
Email
916.253.3334