How Cybercriminals Find Wealthy Targets

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Social Media’s Slippery Slope for Private Client Advisors

Cybercriminals are using the treasure trove of information available on social media to target the wealthy—a term called whaling. Instead of blindly phishing millions of people in the hope of catching a few thousand dollars, criminals leverage private client advisors to concentrate on verified wealth potentially worth millions. Security experts warn that these focused, highly personalized attacks are increasing, hard to detect, and very effective. And many advisors are aiding criminals by making it easy to find the big phish.

Trawling social media networks and company websites for financial, insurance, and risk management professionals is perfectly legal, and a brilliant way to locate wealth. “Cybercriminals are incredibly smart and resourceful, and their methods and technology are increasingly sophisticated,” says Anwar Visram, CEO of Visram Security, a cybersecurity expert with 25 years' experience in technology and security advising HNW/UHNW families, celebrities, and athletes.

Private client advisors lead criminals to wealth

Cybercriminals look for wealth hubs. It’s hard to find a better starting point because key identifiers (e.g., private client, high net worth, wealth) are terms typically used in private client advisors’ social networking profiles on sites like LinkedIn, Facebook, and Twitter. Just define the search filters and drag the net—easy enough.

The outcome is a basket full of beacons telling wrongdoers where the money path begins. Then, sifting through advisors’ networks to find clients is elementary as the tools of the trade are purpose-built. Social media has made looking for a needle in the haystack a walk in the park.

“Impersonation is the single biggest cyberthreat, and the wealthy are prime targets,” says Visram. Once targets are obtained, perpetrators will often impersonate one or both sides—advisor or wealthy individual—depending on whom and what they see, the preferred attack method, and the objective: theft, fraud, robbery, extortion, or ransom.

Are you introducing cybercriminals to your clients?

Look at your professional or company social media pages from a public user, follower, or connection view. Anybody and anything you can see can also be seen by everyone else.

Limiting access to your network only to approved connections provides a false sense of security. Cybercriminals can simply build a pseudo profile impersonating wealthy individuals with whom most advisors would be eager to engage. Once connected, these perpetrators are on the inside.

When did it become acceptable to expose clients?

Advisors must recognize three things:

  • Social media is a high-exposure and high-risk public space that criminals exploit
  • Private client advisors are ideal wealth markers and impersonation opportunities
  • Clients expect advisors to know of and avoid threats

Social media’s attractiveness is understood. I spent many years involved with emerging media platforms while at companies such as Google. And my business uses social media. But we don’t work with wealthy clients; our customers are professionals working with wealthy clients—big difference.

As a marketing tool, social media offers an easy way to show off connections in an attempt to attract business—which is precisely the point. When did it become acceptable for an advisor to show off or expose clients in public?

Visram likes to use an analogy: Using social media "is like an advisor taking a group of clients to a crowded restaurant, known to have thieves present, and the advisor clinking their glass with a fork as they stand to announce they are dining with wealthy people.“

Social media is a maybe not a must-have

Advisors and their clients should take advantage of the extra level of built-in security—often referred to as two-factor authentication or verification—available on most reputable online services. Accounts will be more secure from takeover attacks. But this only partially mitigates risk because it doesn’t render targets invisible or prevent other types of attack.

Bottom line: Social media is risky business for private client advisors and their clients. Working with the high net worth and ultra-high net worth is a specialty that requires additional consideration and comes with heightened expectations.

Given how intertwined social media is with personal and business life, we often forget it is not a must-have but a maybe. Many don’t use it and still do very well. Some even uphold eschewing social media as a differentiator in their client relationship management and marketing.

Can private client advisors safely and responsibly use social media for business? The short answer is, yeswith strict limitations and control. We’ll discuss specific strategies and tactics in an upcoming post on The Refined Connection blog.

 

John Frankot is founder and president of Triple R Media and publisher of LIFE REFINED, a high-net-worth branding, retention, and referral tool. He mostly works with private client financial, insurance, and risk management firms; and, luxury real estate brokers.

Understanding 4 Myths About the Wealthy

Must Knows for Wealth and Luxury Professionals

Developing strong client relationships is crucial for professionals working with high net worth and ultra-high net worth clients. Being good at what you do simply is not enough—likability and trust are critical differentiators, they are built through personal understanding and connection. 

Below are four common myths about the wealthy.

Source of wealth

The first misconception is the high net worth “HNW” ($5-29mm), and ultra-high net worth “UHNW” ($30+mm) inherit their wealth. As Wealth-X highlights in 8 Common Myths About the Super Rich, only 19% of the UHNW fully inherited their fortune, while 65% were fully self-made and 16% inherited some money but much of their wealth comes from their own entrepreneurial endeavors. The fact is, the vast majority of HNW and UHNW individuals worked for and built their wealth. They are no stranger to hard work, long hours, risk, and failure before hitting it big. Many attribute their wealth to a strong work ethic, thriftiness, and determination or passion.

Education

Many think the wealthy all have Ivy League degrees. Which just isn’t true; only about five percent of the wealthy attended Ivy League schools. And plenty dropped out or have no college education—Bill Gates (drop out), Folorunsho Alakija (no higher education), Michael Dell (drop out), Amancio Ortega (no higher education), and Rachel Ray (drop out) are a handful. This doesn’t mean education is unimportant to them; many are dedicated life-long learners eager to learn from others and experience. They don’t have anything against, and often support pursuing a college degree; however, they are likely to point out college is not a requirement or a guarantee of wealth, success, or happiness.

The wealthy don’t give back

Yes, many wealthy individuals are thrifty and even partially attribute their financial success to being so. Warren Buffett seems to relish his reputation for being frugal. However, it would be a mistake to interpret this as being ungenerous or anything more than understanding the value of money and using it wisely. The fact is, the wealthy value and give much to philanthropic causes. The Wealth-X and Arton Capital 2016 philanthropy report, Changing Philanthropy: Trend Shifts in Ultra Wealthy Giving, estimates that on average the world’s UHNW give approximately 10% of their net worth to causes such as health, education, arts, culture and humanities, and public / social benefit. The typical UHNW philanthropist donates approximately $29 million over their lifetime, and the giving index seems to be rising with socially and environmentally conscious millennials reshaping philanthropy and innovations such as impact investing.

Attitude towards wealth

Many wealthy people don’t consider themselves “wealthy”. They are often understated and perfectly happy enjoying their money quietly and sensibly. The reality is, most are very “normal” people you would never recognize as having a lot of money. True, they might not fret much about paying the bills and they spend more time enjoying the freedom and privileges wealth makes available. But they see money as a tool or vehicle rather than a destination or objective. They keenly understand people create wealth, not the other way around; and, that being your authentic self regardless of how much money you have is among the best advice anyone can follow.

 

John Frankot is founder and president of Triple R Media and publisher of LIFE REFINED, a relationship management and content marketing tool designed for wealth and luxury professionals.

Master Gratitude to Strengthen and Fuel Business for the Long Term

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Gratitude is widely acclaimed a cornerstone to success and happiness in our business and personal lives—but it is far more than just a mindset or mantra. It is an actionable business strategy that strengthens relationships and generates revenue. It even has a name . . .

What is appreciation marketing?

Appreciation marketing is conveying gratitude in an effort to build a personal bond and long-term loyalty with relationships, such as clients, centers of influence, referral sources, and prospects.

The goal of appreciation marketing is to develop loyalty and influence in order to solidify and cultivate business. It is one of the oldest and most powerful forms of marketing; it particularly fits relationship-centric and wealth-based businesses where goodwill, top of mind awareness, and word of mouth are key business drivers. Additionally, the strategy is ideal for professionals working with a clientele sensitive to solicitation and promotion or unmoved by conventional marketing and advertising.

The fact is, some professionals utilize appreciation marketing without thinking of it as such. Perhaps the most familiar and timeless example is the handwritten thank-you note.

Develop a system to convey gratitude

Considering its proven success, it is surprising many are haphazard about expressing appreciation and thus potentially underutilize the full value of their relationships. Fortunately, establishing and managing a system to convey gratitude is relatively easy. With a little planning, it can be an incredibly, if not the most, effective and efficient marketing and business development investment.

Why is showing you are grateful so important? Consider that research shows the primary reason customers leave a provider is a result of perceived indifference. For example, a 2015 study by Spectrum Group found that 58% of high net worth respondents switched financial advisors in their lifetime, and two of the three primary reasons suggest feelings of perceived indifference: the advisor was not proactive in contacting me, and the advisor did not offer me good ideas and advice. If you want to strengthen and grow your business, don't forget about the customers and relationships you already have. Remember, it requires significantly more money, time and effort to acquire new clients verse retaining and cultivating referrals from existing relationships.

The big idea is establishing a system that makes it easy and fun for people to positively think of you often and share your business with others. People are busy; their wealth manager, real estate agent, risk advisor, insurance broker, etc. are not the first thing in their mind, and sharing them is probably close to the last. Not because they don't like or want to, they just don't think about it. Frequently showing your appreciation provides a friendly reminder.

Be effective at getting personal

Businesses obviously care about relationships. However, perception is reality, so if people think you don’t care . . . you don’t. Perhaps the truth is many professionals are merely indiscriminate or ineffective at communicating and showing appreciation, or they don’t yet realize how beneficial it can be.

Losing a client or center of influence due to a competitive disadvantage (i.e. fit, cost or performance) is one thing; losing them because they feel you don’t care enough is a tragedy. People will often be candid about competitive disadvantages, and this is good as it provides an opportunity to address, resolve and learn. But, you don’t care is often a silent death; there is often a bogus reason given or worse silence. Why? Because it [caring] is personal.

Getting personal is the central idea. Loyalty and influence built through a personal connection solidify business and helps turn relationships into advocates. This is why gratitude is an excellent tool for professionals working with high net worth clients, where success is largely about relationships: understanding, serving and utilizing them.

Execution

There are many ways to execute an appreciation marketing strategy. What is most important is the tactics are well-received by the recipient, and they make a positive lasting impression. It is a good idea to use multiple methods; I recommend using a mix of "evergreen" (create an everyday presence) and "episodic" (event based or occasional). The various tactics can be roughly categorized into three buckets: Verbal, Activity, and Gift.

Verbal: Say thank you often. Make it part of the company culture.

Activity: Things you do, such as writing a thank you note or a client event or outing.

Gift: The powerhouse of appreciation marketing. Gifts can serve a dual purpose of conveying appreciation and deploying a passive "evergreen" marketing tool. (See: 5 Traits That Turn Gifts for Wealthy Clients Into Powerful Marketing).

Attracting, engaging and cultivating relationships, particularly in the wealth and luxury spaces, is becoming increasingly more challenging as technology and other business forces increasingly commodify services and products. Appreciation marketing is a surefire method to differentiate your brand and nurture long-term relationships to solidify and fuel business.

 

John Frankot is founder and president of Triple R Media and publisher of LIFE REFINED, a relationship management and content marketing tool designed for wealth and luxury professionals.