You can learn about the specific training, qualifications, and discipline history of any IIROC-registered advisor by searching IIROC’s Advisor Report at pages/advisorreport.aspx.

Mediaplanet: What are some of the first questions you should ask your financial or investment advisor?

Lucy Becker: You may want to ask potential advisors a few questions before you decide who should help you. Are they registered with a security regulator and what does this entail? What is their training and background? How are they paid? Do they have other clients similar to me? At the end of the day, you should be comfortable with your advisor — and comfortable that your advisor understands your needs, and your financial situation in order to give you the best advice to help you achieve your goals.

MP: How can clients know how certified or how qualified an advisor is? Is there an online database to do a reference check?

LB: Investors should always take the time to ask a potential advisor about their training and qualifications, and whether he or she is certified and what was required to achieve a specific certification or designation.

IIROC also maintains a glossary online of commonly used financial certifications in Canada that includes information about the issuing organization, where to turn if an investor has a complaint, and other helpful information.

MP: How do investment advisors establish trust with their clients?

LB: Once you choose an advisor, before that advisor helps a client make decisions about investments, he/she must understand a client’s needs, based both on their financial situation and where they’re at in life. In fact, IIROC-regulated advisors are obliged to go through something called the “Know Your Client” or “KYC” process, asking a number of questions as they gather information. As an investor, it’s vital your advisor fully understands your needs and your circumstances. Advisors are required to collect this information so they can develop a picture of your financial state of health, fully understand your personal situation, and make recommendations that are suitable to you.  

MP: Do advisors assess a client’s level of risk before advising on specific investments?

LB: IIROC-regulated advisors are obliged to assess a client’s level of risk and their overall circumstance before recommending suitable types of investment accounts, products, and strategies. And they must stay up to date, in case of any change in a client’s situation or needs. These changes can include moving from one life stage into another, unexpected changes in your personal life, career changes, and changes in your investment objectives.