Financial Institutions’ Increased Security Measures: Just Plain Annoying or In Your Best Interest?In your best interest! Many of our clients—responsible people making legitimate requests—are puzzled by the level of proof they are now required to provide when requesting money wires. The enhanced security measures recently deployed by financial institutions worldwide are in response to a recent increase in occurrences of wire fraud. Although annoying at times, simply put, these measures have been put in place for your protection.

Our custodians, Charles Schwab and T.D. Ameritrade, have tightened their requirements for processing wire transfer requests with the goal of protecting our clients’ assets. This means REDW Stanley personnel cannot initiate a wire request even if a well-known client asks us to do so. Both Ameritrade and Schwab require our clients to sign a form with specific wiring instructions in order to process a wire transfer. Even if we prepare the wire form in response to a well-known client’s request, and the client making the request signs the form, it is not uncommon for either of our custodians to call our client to verify the wire request. In addition, both of our custodians have requested, on occasion, that our client call to verify the signature on the wire form when the signature on the form does not match a signature on file. While this additional level of authentication may be frustrating to our clients and to REDW Stanley team members, especially when the request was made and processed by us according to established procedures, it is important to keep in mind that these extra precautions have been implemented to protect your assets.

REDW Stanley Is Looking Out for You1. Steps can be taken to prevent wire fraud from

occurring. These are just some of the steps REDW Stanley takes to prevent wire fraud from happening to you. If we receive a request from a well-known client that is not consistent with the client’s past actions, we will subject the request to additional scrutiny and possibly contact the client to confirm that the request is legitimate. Fraudulent requests made by email have contained grammatical or spelling errors, the awkward use of the English language, or even the inclusion of a foreign language in the request. Although we would like to process all client requests as quickly as possible, when we have questions about a client’s request, we are required to follow up with the client to verify the legitimacy of such request.

2. If we receive a request via voicemail or email to change a client’s contact information, don’t be surprised if we follow up with a phone call to the phone number or an email to the email address we have on file to ensure the request is legitimate. The new phone number or email address could be a bogus account generated by a fraudster rather than the client, and could be used in an attempt to obtain forms or account information.

3. Normally requests for wires, changes to contact information or form requests come from our clients after a discussion of why the change is needed. It is not unusual for us to follow up with a client in order to verify the request if we receive a request that seems out of the ordinary.

Both of our custodians, T.D. Ameritrade and Charles Schwab, are committed to safeguarding and protecting your assets, as is REDW Stanley. Although their requests to verify information can be inconvenient and irritating at times, especially when we know the client and their needs and have prepared the forms required by the custodian, let’s keep in mind that they are acting in all of our best interests.

“Cases of wire fraud—

fraudulent money transfers by phone or electronically—

in the securities industry have risen more than tenfold

over the past decade, to 3,923 cases last year, according to data from

the Treasury Department’s Financial Crimes

Enforcement Network.”

“Wire Fraud Is on the Rise” – The Wall Street Journal, October 2013

December 2013

Continued...Copyright 2013 REDW Stanley Financial Advisors, LLC. All Rights Reserved. This publication is intended for general informational purposes only. The information provided herein is for informational purposes only and should not be construed as investment, financial, tax, or legal advice.

Hacked Emails: Don’t Be the Next VictimMost of us have experienced the trauma of having our email account hacked or knowing someone who has. If this has not happened to you yet, I’m envious. If it has happened to you or someone you know, then you are already familiar with the resulting inconvenience. We have had two clients recently experience this unpleasant event. One notified us soon after she became aware of the incident, giving us a heads up so that if we received an out of the ordinary email request, we would be suspicious. As of this date, we have not received any suspicious email requests allegedly from that client. However, we did receive two suspicious emails from another client. Because the emails contained wording that was not characteristic of that client and because a link was included in the email, we contacted the client to follow up and discovered that her email had been hacked. She is now dealing with the ramifications of a hacked email account, and we are monitoring emails received from our clients more closely.

The possibility of having email accounts hacked is an excellent reason for all of us to be very careful about the type of data we include in emails. If you are concerned about email security, even if your email account has not been hacked, REDW Stanley does have a safer method for transferring your confidential client information. It is a secure web portal where we can post financial information in a safer manner. Any client who has any type of financial information (tax, planning, or asset management for example) posted to the portal has access to their own individual site, accessible only to them and to us, REDW Stanley. Several of our clients are using this system to receive financial information from us and are happy with the outcome. If this is something you are interested in, please ask, and we’ll establish a portal for you.

Happy Holidays and our wish for a prosperous 2014 from the REDW Stanley team.

By Laura Hall, CIMA®, AIF® Portfolio Manager/Chief Trading and Operations Officer

REDW Stanley is a highly respected investment advisory firm with a primary focus on serving clients in the Southwest. As fee-only advisors, we do not receive commissions or sell investment products, so you can be confident that our recommendations and advice are based solely on your needs and with only your success in mind. In Arizona, the firm operates under REDW Stanley Wealth Advisors, LLC, an SEC registered affiliate of REDW LLC. In New Mexico, it operates under REDW Stanley Financial Advisors, an SEC registered firm subsidiary of REDW LLC.

1. Firm section: We are celebrating our second anniversary in our new Albuquerque headquarters and our first anniversary of REDW’s merger with two Phoenix accounting firms. We are looking forward to 2014 and the exciting opportunities ahead for the Firm and our team members.

2. Economic section: Equities have enjoyed a surprisingly good year to date in 2013, and we are in a period of the year that is traditionally good for stocks. Some investors have noted that it’s been some time since we’ve had a correction (a decline of 10% or more), and because we are “due,” they wait. It is true that we’re over two years (550+ trading days) past the point of the last official correction in the stock market, but in the past there have been longer runs without a correction. From 1990 to 1997, 1,767 trading days passed between corrections, and there was a correction-free period between March 2003 and October 2007. The takeaway? Waiting can be detrimental to portfolio performance.

3. Client section: Our clients are multi-talented folks who seek out challenges. On November 3, 2013, one of our clients (a CPA for a construction firm in Albuquerque) ran in the New York City Marathon. A record number of finishers completed the marathon this year (50,266), and our client finished with a time of 3 hours, 58 minutes and 41 seconds, placing 15,091st overall.

Did You Know?

Michael Maslin / The New Yorker Collection / www.cartoonbank.com

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