‘Senior Designations’: Don’t Take Credentials of Financial Advisers at Face Value

When it comes to investing your money, it’s hard to know whom to trust. That’s especially true for older Americans. A new report from the Consumer Financial Protection Bureau (CFPB) says financial advisers marketing themselves as specialists in serving seniors may be causing more confusion than clarity for older investors.

According to the report, financial advisers often advertise “senior” designations to imply they have advanced training or expertise to serve the financial investing needs of older individuals. But, in many instances, these designations are not always a true indicator of actual knowledge.

The CFPB found there are more than 50 different senior designations that financial advisers can add to their titles. Some of these credentials can simply be purchased on online.

Financial professionals who typically acquire senior designations include investment advisers, broker/dealers, accountants, insurance agents, financial planners and other general financial professionals.

The titles and acronyms for the different designations are often similar or nearly identical to other designations, which makes it difficult for consumers to distinguish one designation from another.

For example, the CFPB report shows that Certified Estate Planners (CEP), Chartered Estate Planning Practitioners (CEPP) and Certified Estate and Trust Specialists (CES) are different designations conferred by different organizations, with different training requirements. But the similarity of these titles may lead consumers to believe each possess similar qualifications and expertise.

This leaves older Americans open to potential abuse, the CFPB’s report says.

In recent years, numerous complaints have come forth from regulators and consumer groups about some financial advisers with senior designations who are targeting older consumers and selling them inappropriate and sometimes fraudulent financial products and services.

CFPB said that while people 60 and older make up 15% of the population, they account for about 30% of investment fraud victims.

You can check the background of financial professionals who use senior designations through the following resources:

Broker Check allows you to review the professional background of securities brokers and investment advisers, as well as their firms.

The Investment Adviser Public Disclosure lets consumers to access information, such as services and fees, on investment adviser firms and individual representatives.

If your adviser sells insurance, your state insurance commissioner may offer additional information.

Finally, if your adviser sells securities, your state securities regulator may provide additional information.

To learn more about senior designations, read the Consumer Financial Protection Bureau’s report here.