Confidentiality

When a professional receives a call from a client or someone claiming to be a client, it is important that the individual confirm the person on the other end of the phone is in fact who they say they are. This can be done by having the “client” confirm his or her Social Security number, address or other information. Basically, any type of personal information can be used as a safety check to ensure that you are who you say you are. Obviously, an advisor with whom you speak to on an ongoing basis or know well will not be asking you these questions as they are not necessary and will seem like less of a precaution and more of an inconvenience.

Remember client confidentiality? Legal, tax, and financial advisors have a responsibility to you, their client, to protect your privacy and act in your best interest. As such, they should not be giving out personal information of any kind to a third party without your previous consent.

If you need information sent to a third party, for example, if you are applying for a mortgage, your advisors should be aware of who to speak to and what information specifically they should provide the third party. A trusted advisor should never provide more information than they have been instructed to give.

A Power of Attorney is a legal document that is used to assign legal authority to another. The person who signs a Power of Attorney is called the Principal. The power of Attorney gives legal authority to another person called an Agent or Attorney-in-Fact to make property, financial and other legal decisions for the Principal.

There are circumstances in which professionals will need to communicate with members of a client’s family about their financial or legal issues. Such circumstances might arise, for example, for an elderly client or one who is out of the country traveling. In these circumstances, it is imperative that the advisor do so only if the family member has an executed Power of Attorney. This will ensure that your information is shared only with individuals entrusted by you, the client, to look after your interests.

Modern technology allows us to receive information almost instantly. But we must make certain not to sacrifice our financial safety for the sake of convenience. When setting up investment accounts, for example, financial advisors will often send you the account paperwork via email in order to expedite the process.

They may even facilitate the entire account opening process by pre-populating the forms with personal information (i.e., Social Security numbers). Although this could potentially cause privacy issues for you, it can be avoided.

*Ensure documents sent via email are secure & encrypted.

It is no secret that in today’s digital environment that everyone is operating on some type of mobile device, in most cases, several mobile devices. We all check our emails and log into various accounts while traveling for work or picking up dinner on the go. With this established, does your financial professional utilize a (VPN) Virtual Private Network? If they do not, or worse, do not know what a (VPN) stands for your sensitive information is may be at risk every day while they are in route to the local coffee shop.

Not only is it better for the environment, it can be better for your privacy. With no paper statements containing account numbers and balances, would be thieves will be left empty handed when they shuffle through your mail and find nothing but worthless junk.

So, if your bank or credit union offers paperless statements, make sure to sign up. You will help the environment and keep your personal affairs private.

When discarding paperwork with client sensitive information, throwing it in the trash just isn’t enough. At a minimum, professionals ought to invest in shredders that should be used to dispose of paperwork containing information such as Social Security numbers and account numbers.

Asking professionals to send you self-addressed envelopes may not seem like an obvious method to privacy protection, but it is. Transposition errors can cause confidential information to land in the wrong hands. By sending self-addressed envelopes to clients, professional advisors ensure that the sensitive information will reach the right person and not fall into unscrupulous hands.