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  • Writer's pictureJerry Ipsen, CFE, MBA

Do You Have a "Trusted Contact Person" on Your Brokerage Account?

Seniors and especially those up in years should consider adding a trusted contact person to their brokerage account. A “trusted contact” is someone you authorize your financial institution to contact if they can’t reach you. Naming a trusted contact person can help protect you from fraud or exploitation.


One thing to remember: A Trusted Contact Person lacks authority to authorize the purchase or sale of securities in an account but is authorized as a contact person by the account owner.

The Trusted Contact person (over the age of 18) you choose should be someone you trust who is reliable and has your best interests at heart. You can choose a family member, friend, attorney, or someone else.


In some cases, your trusted contact can be the same as your POA. However, a trusted contact authorization alone does not enable somebody to make decisions on your behalf. Again, the trusted contact cannot provide instructions to your advisor or custodian. A trusted contact isn’t a beneficiary, and being named as a trusted contact doesn't give that person access to your account.

 

If you’re still wondering if a trusted contact person is right for you, here are several reasons why you should add a “trusted contact person” to your brokerage account:

 

·        If your brokerage firm cannot reach you, adding a trusted contact person to your brokerage account may help your firm ensure that your current address and contact information are correct.

·        Adding a trusted contact person to your brokerage account may help your brokerage firm respond to possible financial exploitation or fraud in your account and protect your account’s assets. 

·        If your brokerage firm suspects that you are experiencing a health issue, adding a trusted contact person to your brokerage account may help your broker confirm your current health status.

·        Adding a trusted contact person to your brokerage account may help your brokerage firm verify the identity of any legal guardian, executor, trustee or holder of a power of attorney on your account.




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