Wealthy Be Aware of Shady Financial Advisors
Wealthy Be Aware of Shady Financial Advisors
Despite all the benefits and perks that come with being wealthy, there are also many pitfalls that many wealthy individuals can get caught up in, especially when those wealthy individuals are thrust into their wealth very suddenly, like a professional athlete or entertainer. Many of these wealthy people are not ready to handle the sudden wealth and they end up blowing it on all kinds of the wrong things. Additionally, even many wealthy athletes and entertainers who realize they need help and seek out financial managers , accountants , and investment advisors , still end up in financial pitfalls, because they trust the wrong people. While there are many credible financial and investment advisors to choose from, unfortunately, there are also many others that are not. These shady advisors are always ready to cheat the wealthy out of their riches.
Duncan Gets Duped
Recently, San Antonio Spurs star Tim Duncan filed a second lawsuit against his former financial advisor after he accused him coercing him into making bad investments that ended up costing the NBA star millions of dollars. In fact, according to reports, Mr. Duncan lost more than $20 million to his former confidant. The problem is many athletes trust these advisors and think they are making a wise investment . In the case of Mr. Duncan, he was only trying to secure his financial future to ensure that he and his family would be taken care of for many years down the road. His investments seemed like a good idea at the time, but it turns that the things in which Mr. Duncan invested – sports merchandising and hotels, among other things – were partially owned by his financial advisor.
Advisor Cries Foul
Mr. Duncan also claims that his former advisor cheated him out of $7.5 million through a loan he gave to a company that was also owned by his former advisor. Mr. Duncan says the company also received a bank loan to the tune of $6 million thanks to what Mr. Duncan claims was his forged signature. The NBA star also claims that his former advisor promised to pay him back if he dropped his lawsuit against him, but he never paid up. As for the financial advisor, he claims that Duncan is simply trying to get out from under the bad investments in which they were both limited partners. The moral to the story is that the wealthy have to be careful in who they put their trust.
A Trustworthy Team
In order to successfully manage their new wealth high net income individuals must have a whole team of experts and advisors that are working together in the best interest of their client. Plus, by having more than one person working for them with the same purpose they can execute checks and balances to make sure that things are done appropriately. These advisors should come from different firms or be independent from one another in order to help ensure integrity. Ultimately, however, it’s the wealthy that need to take the time to keep track of what their advisors are doing and where their money is going. If they’re not careful, there will be plenty of so-called advisors ready to sweep in and take advantage of them.
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Alan Olsen, is the Host of the American Dreams Show and the Managing Partner of GROCO.com. GROCO is a premier family office and tax advisory firm located in the San Francisco Bay area serving clients all over the world.
Alan L. Olsen, CPA, Wikipedia Bio
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