This article appears in the February 2021 issue of Investment Executive. Subscribe to the print edition, read the digital edition or read the articles online.
As social distancing continues, you may find that texting clients can be useful for maintaining relationships and increasing the speed of communication.
“Many of my clients view me as their personal CFO. A large part of that is being accessible to my clients quickly and at all times,” said Joss Biggins, an investment advisor with EthicInvest, a unit of Leede Jones Gable Inc. in Vancouver. “Texting allows me to do that with an added level of comfort from the client’s perspective.”
Biggins uses text messaging for casual and administrative communications that don’t require archiving or supervisory oversight. If something needs to be archived or documented, he requests an email or phone call from his clients.
Likewise, Michael Taglieri, senior wealth advisor in Burlington, Ont., with Taglieri Group Family Wealth Advisors, a division of CI Assante Wealth Management, said he uses text messaging and WhatsApp for casual communications with his clients, but only if his clients initiate the conversation or if he wants to send a quick “Happy birthday”-type message.
For instance, a client might shoot Taglieri a text to say they received his email and will respond within a few days or to text him a life update. Recently, a client texted him to say they were doing a home renovation and would be in touch soon to discuss the financial implications.
Since the pandemic began, Taglieri said, more clients have been reaching out via text message.
“From a relationship perspective, [text messaging] makes clients feel like they are part of your circle or are important enough to have access to your cellphone,” he said. “And they are important, so this is a really soft way to show and tell them that.”
Like Biggins, Taglieri noted that if a conversation turns toward business matters, the texting ceases.
At Carte Wealth Management Inc., if a financial advisor is texting with a client who mentions a trade, advisors must take screenshots of the communication and send them to the back office as documentation. The advisor then must delete the text message, said Maria Jose Flores, Carte Wealth’s chief compliance officer.
Texting clients can be risky, Flores said, because of increased exposure to fraud — especially if an advisor’s or client’s phone is stolen. Smartphones also can be compromised through phishing and malware attacks, which both the Mutual Fund Dealers Association of Canada and the Investment Industry Regulatory Authority of Canada (IIROC) warned firms about last year.
IIROC stated in an email to Investment Executive that it recommends advisors check their firm’s policies on text messaging and with their firm’s IT and information-security group to ensure they’re communicating with clients using an appropriate, secure platform. Not all text-messaging platforms have end-to-end encryption in place, for example.
In March 2020, Carte Wealth began using Microsoft 365 software, which enables you to send an SMS message directly from your Outlook account to clients’ mobile phones. Some advisors also use a system called Equisoft/connect, which keeps a record of text messages and emails. Carte Wealth advisors who use the platform are discouraged from exchanging client information, social insurance numbers, dates of birth and full account numbers.
Edward Jones has a proprietary secure messaging system that meets recordkeeping requirements and allows advisors to send messages to their clients’ mobile phones. The platform sends clients security and account alerts as well as appointment reminders, said Wayne Bolton, principal, compliance, at Edward Jones Canada. The two-way communication isn’t as rapid-fire as regular texting, however, as advisors send messages from their desktop computers.
“It looks and feels exactly like a text, but from a branch perspective, it’s not,” Bolton said.
Clients are told that if they send a message after hours, they aren’t likely to receive a response until the advisor or office administrator is back in the office.
Before Edward Jones launched its secure system, the firm permitted branches to send limited administrative text messages. Edward Jones did not, however, permit the use of WhatsApp, WeChat or similar messaging services, Bolton said.
Although text messaging often seems more casual, text communications must be treated with care, Bolton added. Advisors should avoid making jokes or casual comments that could be misinterpreted, he said, and avoid jargon that could be easily misunderstood.
“We’re all professionals, and our messaging needs to reflect that,” Bolton said.