Appointing an Adviser: Do Your Homework
Appointing someone as your guide in the financial jungle can be a daunting task. How do you assess whether they are any good? What pro-active steps can you take to make sure the person who you are dealing with has the knowledge and experience you want?
Regardless of how you came into contact with the adviser, you should undertake some research before you meet. The internet is a wonderful resource for this information.Google the name of the adviser, check out their LinkedIn and Facebook profiles as well as any other references you see on-line. It is extremely unusual for a financial planner not to be present on both platforms but not unheard of.
So what are you looking for? A stable employment record. Experience in the industry, relevant qualifications and statements from satisfied customers. However, remember these profiles were all written by the person you are meeting, so ask for proof of qualifications. You should also check websites of industry organisations which they claim membership to check their credentials independently. For example: UK organisations, Chartered Insurance Institute (C.I.I.) and Chartered Institute for Securities and Investment (C.I.S.I.) both work with the local regulators.
The next step if to consider the firm that the adviser is working for. The U.A.E is less tightly regulated than some other parts of the world. Consequently, there are many unlicensed advisers seeking out unwary expatriates.
It is essential that you receive advice from licensed organisations. Do not fall for the line that they are regulated in UK or wherever. The jurisdiction of the UK regulator stops at Dover and they will not be interested in your complaint about advice received in U.A.E.
The only licenses which are acceptable at the time of writing are from Insurance Authority (IA) www.ia.gov.ae and Emirates Securities and Commodities Authority (E.S.C.A.) www.sca.gov.ae These are the only licensing bodies for financial planners in U.A.E. A trade or commercial license is not the same thing and is required by every business operating in U.A.E.
You can check the regulators websites for corroboration of any claims to licenses. For example, the company I work for, AES Middle East Insurance Broker LLC is regulated by the Insurance Authority and holds license # 189.
Assuming everything checks out, you should meet the adviser. The first time you meet a prospective adviser you should treat this as a job interview, if you have never interviewed someone try and recall what general questions you were asked in your last interview. Remember your aim is to receive high quality financial planning advice from a reputable and knowledgeable source. Use the data you have gained online to think of a few questions.
You are not seeking to test their knowledge of financial services, unless you have a good understanding of the subject. Your questions should be about their: career path; experience; where they see themselves in the long term; areas of specialism; how your needs outside of their specialist subjects are met; why they think they can help you; how they are paid; how many clients they look after; a description of their typical client; reasons for coming to Dubai; reasons for moving from their last few employment positions. This is not an exhaustive list and no doubt you will have some other questions of your own.
Whilst it is important for you to trust your financial planner, you should not give your trust too freely or quickly. Make sure all recommendations are in writing. Your adviser should explain all relevant aspects of the product or service to you in clear language. This is especially important if you are working with your adviser in a second language.A good test is to see if you can explain what you are doing and why to someone you know. If you can communicate it clearly, you probably have a good understanding of what you are doing and why.
I hope the above is helpful. If you know someone who is thinking of using a financial planner, please share this post with them. It may save them a lot of money.
Let me know if you have any questions, comments or concerns.