Fraud is a word no financial advisor wants to hear.
Advisors may unwittingly abet a fraudulent scheme that victimizes their clients, or they may allow it to occur by not taking more diligent proactive safeguards.
Bernard Madoff's multibillion-dollar Ponzi scheme has been the most egregious example of the perils that can befall unsuspecting clients -- and advisors who should have been more vigilant. But there are plenty of others. Just this month, a New York man posing as a successful hedge fund manager was arrested by prosecutors for securities fraud and charged by the SEC
for stealing most of the approximately $840,000 he raised from unwitting investors.
But fraud can also occur in a myriad ways, from email scams to identity theft to manipulation of investment valuations. Page through to see a dozen common frauds -- and ways advisors can help prevent them -- or click here
to see a single-page version. -- Charles Paikert