Time for firms to once again conduct some due diligence into the credentials their brokers and advisers are peddling to existing and prospective customers - given the somewhat and sometimes questionable nature or reputation of firms and organizations that are peddling the certifications.  All told, there are over 200 credentials available to financial professionals, the WSJournal reported.  A financial services credential, or designation, is a professional title that often includes the words "certified," "registered" or "chartered."

CFA (Chartered Financial Analyst) or CFP (Certified Financial Planner) are earned after rigorous course work and lengthy exams.

"Certified Retirement Financial Adviser," "Certified Estate Adviser," "Registered Financial Consultant," or "Registered Financial Associate" are not.

The WSJournal previously reported at least 210 credentials in the financial-services industry, more than twice the number tracked by FINRA and quadruple FINRA's 2005 tally.

    Who's Doing the Training?   Organizations that grant credentials operate virtually unchecked, say state securities regulators.  Whereas medical schools have accrediting bodies recognized by the U.S. Dept of Education, and most law schools have accreditation requirements from the ABA, with a process monitored by the Dept of Education, there's  no apparatus for accrediting the groups that grant most financial designations.  So, while many of the training groups are legitimate and offer students meaningful preparation in financial management, some groups have lower standards, documents and interviews suggest. 

1.  The Society of Certified Retirement Financial Advisors appointed an education chairman who had lost his state securities and insurance licenses. 

2.  The National Association of Financial and Estate Planning had an advisory-board member who had been barred from the industry in his state, over his alleged role in an investment blowup.

3.  The International Association of Registered Financial Consultants recently encouraged advisers to sell annuities in ways that might violate regulatory rules.

1.  The Society of Certified Retirement Financial Advisors.   In 2009, Paul Dyer, a financial adviser in Bangor, Maine, became the Society's national education chairman, and held the position for over a year, even though his securities and insurance licenses were suspended in 2008 by securities regulators in Maine.  It seems Mr. Dyer, in 2007, may have called the The Hartford insurance company and impersonated a client to gather information about his insurance holdings without the client's consent.   The SCRFA says it suspended Mr. Dyer for 6 months, but as of 9/30/10, he was listed as National Chair without mention of his suspension.  Oh, and he's scheduled for a hearing next month re: a separate alleged incident involving a senior citizen and an insurance product.

2.  The National Association of Financial and Estate Planning.   It's credited with creating the CEA, or Certified-Estate-Adviser credential.  The Association, among other things, teaches advisers how to prepare legal documents for financial and retirement planning.  NAFEP's 7-person "advisory board" includes William E. Hopkins, described on NAFEP's website as a "broker dealer" with William E. Hopkins & Associates Inc., a Jackson, Tenn., firm that has "integrated NAFEP estate planning as a key element of the brokerage's service."

The website doesn't disclose that in 2005, Mr. Hopkins was barred from the insurance and securities industries in Tennessee for 2 years for his role in an investment blowup, and for at least 6 years, he sold debt instruments that were purported to pay 9% annual interest.

For further details, go to:    [WSJournal, 11/20, "Who's Advising Your Adviser?"]