Advisor Databases Growing in PopularityPosted by in Blog on June 13, 2012
The information revolution caused by the growth of the Internet also means that more records about financial advisors are publicly available than ever before. WealthManagement.com says that advisors need to get used to this “fishbowl effect.”
For example, the site BrightScope shows all sorts of data – both positive and negative – on financial advisors. Mike Alfred, the CEO of the company, tells WealthManagement.com that his company is simply making more available information that was already out there, such as assets under management, education, and even disciplinary information. But the publication says that Alfred’s company has “knocked the dust off advisor data and put it on display in a new way.”
BrightScope is just one of the companies putting such information out there on the Internet. Paladin Registry gets data from advisors themselves, AdviceIQ only will put up financial advisor information if they have had no records of disciplinary against them, and Advizent has data only accessible to its members. FINRA is also making its databases more user-friendly to the public, with a variety of ways to search on brokers.
Jack Waymire of Paladin tells WealthManagement.com that “higher quality advisors have nothing to hide, and lower level reps are uncomfortable with transparency.” He notes that if advisors ”refuse to answer questions, we go back to the investor with an alert. And we say our experience is you may want to avoid this advisor in the future.”
What this all means is that financial advisors will need to be more transparent with their clients, due to all of these new information out there, because the industry is moving things in that direction, forcing financial advisors to reveal as much information as possible. The article also notes that “advisors are going to be visible whether they like it or not,” so that they should take steps “to make sure that the information being broadcast is accurate.”
Written by Lisa Swan