What is meant by due diligence?

First, the definition should mean nothing more than an investor being "diligent" when checking out the substance of the claims made by an Advisor with respect to the market, the product or service concept, the competition and the management team.. The term "due" means that it's expected and someone has to perform this task.

So the concept is really all about the diligence that is due the investigation into a plan for doing business. There are some in the financial world who expect this to all be done by the Financial Advisor on behalf of the investors, and that's a completely wrong understanding because there is an initial onus upon the potential Client to conduct their own Due Diligence towards the Financial Advisor himself/herself.

Therefore, the very first level of Due Diligence should be conducted upon the professional Advisor.

Is the company who they work for based in the region where they are presenting the product? Are they correctly licensed to conduct business in that location and an they provide references from satisfied Clients of your own Nationality with whom you can discuss their service and professionalism.

Once this is completed, you then need to look at how the Advisor has read your personal circumstances and what they are recommending in the form of a Proposal.

Do some background research on the product being recommended. The Internet is a great tool nowadays to find information about Companies. No matter how glossy or appealing a brochure or company literature can appear to be, always check the web-sites of recommended companies and ensure they actually are, who they are purporting to be. Financial Page International only uses companies that are household names and where possible, Fortune 500 companies.

Correct due diligence upon not just the professional Advisor, their company or the Products recommended will always reduce the chances of you making an incorrect and costly assumption without checking first.

Please see our section on Scams and Frauds by clicking Here and this will help you get a better idea of the sophistication of many Scams and Frauds currently our there.

You can also download one of our Telephone Scam checklists by clicking Here. We recommend you print this out and keep a copy to hand next to your telephone. In the event of you receiveing a dubious call from someone offering you the 'deal of a lifetime', just follow the diagrams on the single page and you will, we feel, save yourself potentially a great deal of trouble in the future by conducting your own Due Diligence at the outset.

Due Diligence takes very little time to perform and can be singularly the most important thing that you do when establishing trust in a Financial Advisor. Professional and Reputable Advisors will never be offended by this and will understand your reasons for doing so: as for the Cowboys, we think you know how they would feel about this!