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Recovering Losses Caused By Investment Misconduct

What You Need To Know About Financial Designations

Once you have made the decision to hire a financial professional to help manage your investments, you will notice that some of these people may have a number of letters following their name. In the majority of cases, these letters refer to professional designations. FINRA recently published some information on its website The Alert Investor about key things to keep in mind when reviewing potential candidates:

  • There’s a difference between holding a professional designation and being licensed or registered. Any person looking to conduct sales activities or provide financial advice in the securities and insurance industries must first register with a regulatory body. All brokers must register with FINRA and, depending on the amount of money they handle, either a state or federal regulatory body. Financial advisors who manage up to $100 million in client assets must register with a state securities regulator, while an advisor who manages at least $110 million in client assets must register with the United States Securities and Exchange Commission (SEC). If an advisor manages between $100 million and $110 million, they may voluntarily elect to register with the SEC instead of their state regulator.
  • Not all financial designations carry the same weight. Much like a degree issued by a school, different financial designations require people to fulfil different requirements, ranging from rigorous education and testing to simply paying a fee. FINRA maintains a list of what different designations take to earn in their Professional Designations tool.
  • Financial designations can be faked. Just because someone lists a designation after their name doesn’t mean they actually earned it. In fact, this is a common tactic used by fraudsters attempting to scam a new mark into trusting them. Organizations that issue these credentials often maintain publicly-accessible databases that you can search to confirm a designation. Any time you’re looking to hire someone to help you handle your finances, it’s important to do a background check on both them and the organization that issued their credentials.

Our investment fraud attorneys at Meyer Wilson have spent nearly 20 years fighting for victims of fraud, and through our efforts have successfully secured more than $350 million in verdicts and settlements for our clients. If you were the victim of a scam or a fraudulent broker, contact us today by calling us at one of our offices located across the United States, or fill out our online form to start out with a case evaluation today.

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