My Financial Advisor Lost His License After Scamming Older Women

Listen to your gut feeling even if it’s based on slivers of information

I chose my financial advisor the way you are not supposed to make that decision.

I went to a free lunch presentation titled “Can You Afford to Retire?” After the PowerPoint, each attendee was offered a free one-hour advisory session.

In my defense, I had retired to a new community, had my retirement dollars in previous employers’ accounts, and had asked several people I knew for referrals, and nobody had a financial advisor. That tells you something about the crowd I hang out with.

I have written about my mixed feelings about money. Most of us have mixed feelings about money. Money is the root of all evil. Money is a source of power. And security. Especially in retirement.

I had moved, and estimated I could retire, but had a job I wanted to quit in my new location. So I went to the seminar and the advisory session. The financial advisor (now unlicensed) told me “Yes, you can afford to retire,” and I did while keeping some little part-time easy income.

I trusted his advice because I felt insecure. He told me what I wanted to hear as I sat in a very nice office with his big Labrador, a friendly dog breed I liked and who licked my hand.

All good influences that have nothing to do with objective financial planning, which he undoubtedly knew.

The Financial Plan

He presented me with a financial plan. I initialed that I had reviewed it and understood it, even though I really didn’t understand it. He talked too fast and didn’t allow me enough time to really think about what he was saying.

I agreed to buy an annuity. But left all my other scattered accounts scattered, resisting his gentle pressure to consolidate because I wanted to think about it. I usually always “sleep on a decision” but did buy the annuity.

When I asked questions about the annuity later, there were some features — time until withdrawal — that I don’t remember him emphasizing. I did not like them. However, the plan was with a well-known, reputable company so I was OK with that aspect of it. I had stressed to him that I wanted a portion of my money safe and secure and low-risk, while the other part could be more diversified.

About a year later, Covid hit. He invited me to his new office. He had bought the building, an upscale office building, new, mostly empty, three months before Covid. We joked about how he should turn it into rental apartments because the commercial real estate market had collapsed.

But I filed away the fact that he was probably in a poor position suddenly, an unpredictable financial position. He tried to talk me into selling the annuity, which should, he said, be diversified in the current market.

I liked the security of an annuity in a time when nothing else was secure.

Besides, there were substantial penalties for selling early. I said no, and did not transfer any more IRAs, because a great big red flag waved among my other gut feelings that I was a financial mark.

The newspaper carried a small item sometime later: The state insurance commissioner revoked the license of a financial advisor after complaints from single women retirees. He had given them bad advice about selling annuities and gained money at their expense.

Yup, that guy.

Marks and Unmarked Envelopes

I received an unmarked envelope from his now-defunct financial advisory firm advising clients that the firm was no longer in business. Investments should be taken to a new firm. Which I did, based on a lawyer’s recommendation.

Now, I don’t think I am an idiot.

I listened for years to NPR’s money advice show, and I knew all the rules which I still ignored in the moment. I have no explanation. If I had a do-over, I would have brought my most skeptical friend with me to the meeting and told them their job was to prevent me from doing something stupid.

Which is maybe why we’re targets in our retired years. We want to be nice. We want reassurance. We feel insecure.

I just had lunch with two other women, who are smarter than your average bear. They each had an “I almost fell for this scam I can’t believe it” story. One had wasted a day out of town in a panic to avoid a money-laundering scam the telephoner had told her she was subject to. Avoiding a scam is the scammer’s latest strategy. I trashed an email inviting me to do something similar.

Why do we fall for scams? We know we are smart enough to know better. (One check) We are embarrassed. (Two checks) They prey on our fears and talk fast. (Three checks) I’m posting this story because fear, embarrassment, and shame are not emotions worth losing money over.

I thought fear, embarrassment, and shame were behind me.

I’m telling you this story so I won’t have been a target in vain.