The Crucial Role of Trusted Contact Persons for Seniors and Their Investment Managers

When seniors work with investment managers, having a Trusted Contact Person can make a significant difference in protecting their financial well-being. This role is designed to provide an extra layer of security and support, especially as seniors may face challenges such as cognitive decline, fraud risks, or complex financial decisions. Understanding what a Trusted Contact Person does and why this role matters helps seniors and their families maintain control and confidence over their investments.

What Is a Trusted Contact Person?

A Trusted Contact Person is someone an investment manager can reach out to if they have concerns about a senior client’s financial situation or well-being. This person is usually a family member, close friend, or caregiver who is authorized to discuss the client’s account in specific situations. The Trusted Contact Person does not have control over the investments or the authority to make decisions but serves as a resource to help protect the senior from potential financial harm.

Why Seniors Need a Trusted Contact Person

Seniors are often targeted by financial scams or may unintentionally make risky investment decisions due to memory loss or confusion. A Trusted Contact Person helps bridge the communication gap between the investment manager and the senior client, ensuring that any concerns are addressed promptly.

Here are some reasons why this role is crucial:

• Protection against fraud: Seniors are common targets for fraudsters. A Trusted Contact Person can help verify suspicious transactions or notify the investment manager if anything appears unusual.

• Support during cognitive decline: If a senior begins to experience memory problems or dementia, the Trusted Contact Person can assist in managing communications and ensuring the client’s interests are safeguarded.

• Emergency contact: In case of emergencies, such as hospitalization or sudden incapacity, the Trusted Contact Person can provide necessary information to the investment manager.

• Peace of mind for families: Knowing that someone is watching out for their loved one’s financial safety offers reassurance to family members.

Choosing the Right Trusted Contact Person

Selecting the right person for this role is critical. The Trusted Contact Person should be someone the senior trusts deeply and who understands their financial situation and values.

Consider these factors when choosing a Trusted Contact Person:

• Reliability: The person should be dependable and responsive to communications from the investment manager.

• Understanding: They should have a basic understanding of financial matters or be willing to learn.

• Availability: The Trusted Contact Person should be accessible during business hours and able to respond quickly if concerns arise.

• Relationship: Ideally, this person is a close family member or friend who has the senior’s best interests at heart.

Seniors should discuss this role openly with the person they choose to ensure everyone understands the responsibilities involved.

Legal and Privacy Considerations

Investment managers must respect client privacy and confidentiality. The Trusted Contact Person is only contacted when there is a valid concern about the client’s well-being or financial safety.

Clients must provide consent for their investment manager to communicate with the Trusted Contact Person. This consent is usually given when setting up the account or updating client information.

The Trusted Contact Person is not given access to account details or authority to make transactions. Their role is strictly limited to communication and support in specific situations.

Effective December 31, 2021, regulators such as the Ontario Securities Commission began requiring portfolio management firms like Sharp Asset Management Inc. to take reasonable steps to obtain from “older and vulnerable” clients the name and contact information of a Trusted Contact Person. 

How to Set Up a Trusted Contact Person with Sharp

 Once you choose a Trusted Contact Person and discuss the role with them, seniors or their families should:

• Provide Sharp with the Trusted Contact Person’s contact details.

• Sign the “Trusted Contact Person Documentation” to authorize communication.

Regularly reviewing and updating this information ensures the Trusted Contact Person remains current and effective.