South Canterbury Finance Limited

[Beagle]

Roger. I think some of that is a cop out.Of course financial advisors should be able to rely on your points.

But one thing not on your list is an advisor should have the skill to sniff out something suspect and then have the balls (or standard of ethical behaviour) not to support any company that does not alleviate those suspicions.

Joe blogs is quite able to loose his own money - he should not expect to do so when he has taken professional advise.

But at the moment our judiciary seems happy not to provide a disincentive to advisors (and the commercial sector) so i have no expectation that the standards of service and expertise will improve. It Is too easy for those involved to keep clicking the ticket which enables them to prey on the vulnerable and lazy.

I disagree. If one of the big accountancy firms who have access too all the records and do a full audit and are happy with the veracity of the financial statements and attest to that, how would you expect a small financial advisory firm without access to the companies internal documents to get a better feel for it ? We are not mind readers mate nor do we have access to documents like the auditors do.
Surely financial advisors should at least in theory be able to draw some comfort from the credit rating agencies ? If extremely well paid analysts at Standard and Poors who have access to the full financial records of the company and are paid extremely well for a thorough professional opinion of same can't get credit ratings right e.g. ascribe AAA credit ratings to CDO's that are little more than a well spread collection of sub-prime loans, how would you expect for example a small suburban financial advisory firm to do better with special insights without access to detailed company records ?

On the other hand you would expect if for example a finance company had a high degree of concentration in one specific risk area like related party transactions, a disproportionate level of lending to the property development sector that finance company might be perceived as having a higher level of risk than some others and perhaps a lower level of investment in that company might be considered prudent or if there were specific risks identified that the financial advisor wasn't comfortable with (s)he might not recommend them.

The idea that financial advisors are out there to prey on the lazy and vulnerable is in my opinion a gross generalisation and misrepresentation of the business model of the vast majority of financial advisors.
In a heck of a lot of cases I think investors are simply taking a "shotgun approach" to potential liability issues and hoping some of the pellets hit the mark somewhere. I guess its only human nature that their personal point of contact, (their financial advisor) is in line for some of that flak but is it warranted... A simple case of many people wanting to shoot the messenger ?....I think so.