In our paper, Advisory Firms of 2030: the innovation imperative, we reported that while most advisors we surveyed had goals to grow their businesses, most were focused on tactics that, frankly, were not necessarily innovative or differentiating. The survey suggested that advisors were not paying attention to evolving client needs or attitudes and run the risk of being marginalized, as consumers are seeking customization, personalization and transparency.
In the second post of what I hope to be a more frequent Advisor Niche Spotlight series, I interview Jim LaPiedra, Managing Partner and Advisor with Guided Professional Solutions. Although Jim may not see it as a niche, I think he has found a way to truly differentiate his firm by adding a solution for clients that most firms don’t offer: identity fraud services. This is an area of risk management that may be ignored by financial professionals and Jim shows how he and his firm saw the need and addressed it proactively.
JDA: Describe how you differentiate your practice?
JL: While many successful advisors focus on a niche, my services include a risk management solution that is needed by everyone. In addition to comprehensive planning, the solution manages the very real threat of identity fraud. Identity fraud in its many forms poses a substantial risk to an individual’s reputation, as well as their personal, professional, and financial well-being.
JDA: How did you get started in this? How did you build it?
JL: I got started several years ago when one of my partners became aware of a program being offered to financial advisors that addressed the risk of identity theft and how they could help reduce their client’s exposure. Given my former background in law enforcement, they asked me to attend the training session to evaluate its benefits. My evaluation revealed the program was a good start, however it didn’t adequately address the threat. I also discovered that many of the other identity theft protection services being offered were, in my opinion, marketing companies selling fear. They provided little in the way of substantial security solutions. It led me to build my own from scratch covering the security cycle of prevention, detection and recovery.
Being a financial advisor, I already help my clients manage financial risk by developing investment strategies that are in accord with their goals, as well as managing their emotions based on good investment principles. But, I believe, I’m also in the best position to educate clients on the risk of becoming a victim of identity fraud, as well as developing good security habits that will help prevent fraud, help with timely detection and providing access to expert fraud resolution experts if they were to fall victim.
One key differentiators is a process I automated that I call the ID Checkup that assists clients with requesting their various credit and specialty consumer reports with the main bureaus and agencies that maintain personal information. The ID Checkup allows my clients to do an annual deep dive into what I call their “identity footprint.” This allows clients to review their credit files, background reports, rental history, checking history, DMV records, and medical insurance payouts for fraudulent activity and errors. For my key clients, I do the ID Checkup with them. My other clients are provided access to the tool that allows them to do it themselves. The last component of the offering is placing 24/7 credit and identity monitoring with an expert resolution team. The client can select one of three plan offerings at deeply discounted pricing.
JDA: Obviously, not many advisors focus on this area. What are the benefits?
JL: Focusing on this issue has benefited my business in a number of ways:
- The experience I created allows clients to feel relieved that a risk they have been concerned about is now being addressed, strengthening the relationship.
- I find that clients are more willing to make referrals for this service than traditional financial services, thus growing my business.
- Prospecting has been more successful due to the interest in the ID Checkup offering. As you said, very few financial professionals are addressing this need, so the opportunities are great.
JDA: What have you learned?
JL: Gone are the days of relying solely on credit monitoring. Individuals need to be more vigilant, proactive and self-reliant than ever before. With the dynamic changes in technology, thieves are finding new ways to hack systems, invade our privacy, and capitalize on our information. Lesser-known identity crimes — social security, medical, insurance, criminal, and even child identity theft — are growing at an alarming rate. This is a very real financial risk. I want to be the one clients turn to for a solution.
JDA: Any parting thoughts?
JL: Our clients’ needs are changing and we need to deliver advice centric solutions that address these needs. As advisors we risk becoming commoditized. By expanding our service offerings and addressing the different aspects of our client’s lives, we create valuable experiences that strengthen our relationships. But more importantly, we become needed. We hear a whole lot about delivering holistic services, but unless your services are effective, meaningful and relevant, you’ll be a commodity differentiated only by price.
James LaPiedra, CFP® is managing partner at Guided Professional Solutions in Staten Island, NY, specializing in retirement planning and distribution strategies. He also brings a skill set and knowledge rarely found in the investment industry as a Certified Identity Theft Risk Management Specialist, CITRMS®. Jim is a former Deputy Inspector with the New York City Police Department and Senior Security Manager for Lehman Brothers overseeing North and South America. He holds a BBA in accounting from St. Johns University and was a staff accountant for four years with Potter & LaMarca LLP. He is the author of "IDENTITY LOCKDOWN, Your Step-by-Step Guide to Identity Theft Protection."
The opinions and views expressed herein are those of James LaPiedra. SEI cannot guarantee the accuracy or completeness of the information and assumes no responsibility or liability for its incompleteness or inaccuracy.
James LaPiedra and Guided Professional Solutions are not affiliated with SEI or its subsidiaries.
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