Updated Friday, July 25, 2014 as of 1:07 AM ET
Security Strategies for HNW Clients
Friday, March 21, 2014
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Do wealthy clients ask their financial advisors about security?

“All the time,” says Jason Romano, a principal with Moss Adams Wealth Advisors in Los Angeles. And it’s not a one-way street. “We have several clients who have given us ideas,” says Romano, who has passed them along to other clients.

High-net-worth clients travel frequently, which can present security problems. One major concern is when a child travels overseas, says Paul Pagnato, managing director of HighTower’s Pagnato-Karp Group in Reston, Va. Clients, he says, worry that the child could be “a target because of the wealth that the family has.”

Pagnato’s group has partnered with a personal security firm to offer help. That firm will meet with the family and will contact the local U.S. embassy in advance. In some cases, the security firm will provide a special phone that includes an alert button to send a distress signal. “It’s pretty sophisticated,” says Pagnato. “They can have the camera take a photo every 30 seconds.”

Threats can occur at home, too. So, the family must have a plan to get out. “Map out an evacuation route,” says Pagnato and have a “go” bag ready with the things you may need for a few days. “That helps give some of our clients more comfort,” he adds.

Since Romano’s clients live in an earthquake zone, a basic piece of his security advice is to keep gas in the car and emergency cash in the house. Should the power fail, neither gas pumps nor ATMs will work. He also suggests that home alarm systems be linked to smart phones, so that clients know instantly when an alarm has been tripped.

Romano reminds clients to be careful on social media sites. A posting that “it’s great here in Hawaii” announces to the world that you’re not home. Pagnato notes that clients can have a third party monitor children’s social media postings to make sure they don’t reveal too much about the family’s circumstances.

In Los Angeles, notes Romano, “everyone expects valet parking wherever you go.” He suggests keeping the car registration in your wallet. If your home address is in the car along with a button to open your garage door, you’ve given a thief full access to your home.

In recent years, says Pagnato, the “cyber threat has increased substantially.” One client received an e-mail asking where to wire money. “They know to contact us,” he says. But as a final defense, Pagano’s firm offers LifeLock because recovery from identity theft is “such a time-consuming business.”

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