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Spoofing is the buzzword that’s used when a hacker or thief impersonates a financial adviser’s client and requests transfers, or the disclosure of sensitive information. One common method used by thieves is hacking into a client’s email account and then sending emails to the advisory practice, asking funds to be transferred to certain accounts. The savviest of these criminals can also find out ways to get into a client’s mobile phone account, set up call forwarding and then impersonate the client in case the adviser calls to confirm the requested transaction.
Financial advisers have to put in place certain security procedures to prevent spoofing from happening. While it’s not an extremely common occurrence, clients should make sure they understand how their adviser handles sensitive information.
“Good procedures can circumvent this,” says Linda Leitz, Chair Elect of the National Association of Personal Financial Advisors. “Also, many financial advisers don’t take custody of investment assets.”
For consumers working with financial advisors, asking questions about security isn’t just important anymore – it’s essential. Here are a few things to ask:
Protecting against identity theft is often an individual’s responsibility, but companies that deal with sensitive information also have an obligation to protect clients’ assets and interests.
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