The unintentional omission of material facts in your presentations can be as dangerous as fraud. Often, it’s not what you say that gets you in trouble, but what you didn’t say that gives a voice to silence. Sometimes silence is golden, but other times it’s just plain yellow.
Critical information missing in the decision-making process to the public can nullify an entire presentation and expose you to a lawsuit. Indeed, certain omissions can be such a tipping point item that it could morph into suitable problem for the client, i.e. the client wouldn’t have purchased the product because of their aversion to risk, or illiquidity or the taxable events triggered by your sell off recommendations.
And it’s not enough to hand the public a carrier brochure and walk away feeling that you’ve performed the sufficient disclosures, disclaimers or caveats which in and of themselves will never be a defense in arbitration or litigation.
Unintentional omissions are often based on uneducated advisers. The sales force at large lacks the training and education of much of the product lines sold. After all there are not many Rhode Scholars and attorneys among us. All the CE ethics courses in the world can not overcome the omissions of an uneducated adviser.
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