Winburn Wealth Management is a company in Arkansas that helps people with their money. They say that helping their clients is their main goal, but their terms and conditions show that their main goal is to fill their pockets.
So, before you decide to work with them, you should read their statements and look for the following red flags:
About Winburn Wealth Management
Winburn Wealth Management is a company in Little Rock, Arkansas that helps people with their money. They are part of UBS Financial Services Inc., and their address is 10800 Financial Center Parkway Suite 400, 4th Floor, Little Rock, AR 72211, US.
Their office can be reached at 501-221-5101. This company was started by Hardy Winburn, who has been in charge of it since 2002. He has certificates in CFP, CIMA, CLU, ChFC, CFS, RICP, and CEPA.
Winburn Wealth Management helps its clients with different kinds of planning and investment. Even though the company says that its clients come first, the disclosures show otherwise.
Here are the problems with this company’s disclosures:
They try to hide the following problems with Winburn Wealth Management: $600,000 Problems with a client
You should look up a counselor on FINRA BrokerCheck before you start working with them. It’s a library with all the information you need to know about a financial advisor’s work.
FINRA BrokerCheck shows that Hardy Winburn had a disagreement with one of his clients in 2009. Between 2007 and 2008, the client said that he was careless when he promised him a better rate of return and increased his risk with a leverage account.
The client of Hardy had asked for $600,000 in damages. The claim was turned down because the client had agreed to all of the strategies and plans that were put into place, according to the financial adviser.
Still, it’s not easy to be in such a big fight with a client. Maybe Hardy got into this fight because of the different rules in his statements, which I’ll list below.
Putting clients in too much danger
Winburn Wealth Management charges fees based on how well their investments do. This is a very common practice in the finance world. With this fee system, your advisor only gets paid if they do better than a certain benchmark.
This fee system gives the advisor a reason to use high-risk strategies, even if the client doesn’t need them. Research shows that advisors who get paid based on how well their clients do tend to follow high-risk strategies that don’t help their clients.
When markets are slow and unstable, high-risk tactics are especially dangerous because they can wipe out a big chunk of your invested capital.
Worse still, you can’t do anything if you lose your investment or lose a lot of money.
Putting Fees of 12b-1
The fees for the products that Winburn Wealth Management offers are 12b-1. The 12b-1 fee is a promotion fee that usually goes to the advisor’s pocket. This fee adds to the cost of your investment without giving you anything in return.
SEC did a study to see if there was a difference between the results of mutual funds that charge 12b-1 fees and those that don’t. They found that mutual funds with a 12b-1 fee don’t do as well because the profits are the same but the cost is higher.
To be safe, it’s best to stay away from financial advisers who charge this fee.
The fees that Hardy Winburn and his company get to bring in a lot of money. They get these fees when certain investments are sold. When a financial advisor gets paid on commission, he or she has more than one reason to favor certain stocks over others.
Some of the problems that could come up because of this payment system are cross-selling of commission products, misrepresentation, and making suggestions that aren’t good for the customer. It’s best to avoid these kinds of financial gurus and work with others instead.
This is one of the main reasons it’s hard to trust Winburn Wealth Management.