Why Do Financial Advisors Need To Know About Skimmer Scams That Illicitly Scan Credit Cards And PINs?

Thursday, January 05, 2012 12:30
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Why Do Financial Advisors Need To Know About Skimmer Scams That Illicitly Scan Credit Cards And PINs?

 
As a financial advisor, I believe you have a responsibility to help clients protect themselves from identity fraud and credit card scams. (It's wrong that the CFP Board of Standards does not award CFPs educational credit for learning about online privacy and security.) Financial advisors must be guardians of their clients' online financial lives.
 
With fee compression a growing concern, adding value to client relationships by educating clients on online security is good marketing. Being an authority — the resource for clients on online privacy and security — positions you as an expert in financial communication. Plus, you have the added benefit of doing good.
 
It's actually in your interest to know a lot about online security and privacy. I speak with advisors all the time who are spending a lot of money still on assembling and mailing paper quarterly reports to clients. That's  expensive and largely unnecessary. (Yes, my company sells systems for online reporting but that's not why I am arguing for it.) Going online with performance reporting is a no-brainer to me because it improves your firm's client experience and makes your business more efficient. Getting clients to change their behaivior and adopt online reporting is part of the educational information advisors should be providing to clients. But back to skimmers.
 
Even though the odds are low that one of your clients will get ripped off in a skimmer scam, as an authority you need to know about skimmers and disseminate tips about them to your clients and prospects. 
 
PC World says skimmers are devices thieves attach to card readers on ATMs or credit card terminals to collect your financial information. A Symantec spokesperson quoted in the article says many skimmers are shoddy, jury-rigged and awkwardly attached. So if you see a card reader that looks a little weird, be wary.
 
The other thing to look out for: pinhole cameras.
 
Let me know if you think advisors should be a clearinghouse for information about online privacy and security for their clients.
 
 

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Comments (1)

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BrianEdelman
I think advisors should be educating their clients (and themselves) on the measures they take to protect clients from these types of threats. i.e. using a vault, encrypted email, login failure alerts, etc...

However, I would be concerned from a liability perspective with an advisor taking on the responsibility of advising clients on cyber security.
BrianEdelman , January 06, 2012

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