Full Disclosure

Many years ago, I sat with a man whose cagey demeanor told me there was something “back there” that haunted him. In all candor, all of us have moments in our past which we have put in a lock box because they are too painful, too raw to take out and revisit. With gentle nudging, I let him know I was safe. He could tell me anything in confidence, and I would, without judgment, listen and offer support.

In fits and starts, he unwound to me a season more than two decades past when he sired a child out of wedlock. A baby girl was born into a relationship that could not be sustained. The young mother, with his consent, made a difficult decision to let the baby be adopted by a stable, loving couple. Now, years later, he feared the child might find him and in so doing put at risk his relationship with his wife and three children.

These personal revelations do not mean breaching an obscure wall of privacy. We need not become voyeurs into another person’s life. And yet, when a client’s past becomes the elephant in the room and so darkens his or her involvement in something questionable from a legal or ethical standpoint, more information is required. It is this area of “more” that raises issues for some advisors.

Risky behaviors often lead to unplanned, unfortunate events replete with pain and even guilt, which may cast a crippling cloud over one’s ability to make healthy decisions.

As we all know, the information needed to complete a “knowing your client” interview may not tell the whole story. Clients are not always so forthcoming with specifics about themselves, their business, their family, or their past. Times are, those unrevealed details of a client’s life can look like the Berlin Wall: impenetrable, fearsome, and potentially harmful. And yet, the lack of such full disclosure often has a profound impact on maximizing one’s ability to offer his or her best advice.

“Full disclosure” is a buzz-phrase in almost every profession. We use it both with clients and colleagues to reveal either a personal position or a regulation of the firm for which we work. The increased scrutiny by regulators as well as individual common-sense demand that each of us be better advisors because of this added layer of transparency.

Why might a client not be more transparent? In my experience, fear and shame are often behind the silence. The man who sat with me was so crippled by fear of discovery he could not make critical planning decisions for his family. Clients may be ashamed to disclose a business failure, a litigation, bankruptcy, or failed marriage because they believe—rightly or wrongly—that revealing their past will prevent them from an investment or planning opportunity. Fear in all its forms can thwart our best intentions and lead to devastating repercussions.

So, how do we connect with a non-disclosing client? More than anything else, when you sense secrecy in a conversation, tread softly. Shame and fear require patience and compassion before they come out of hiding. Such revelations take time, lots of time. No one can predict when, how or if you will be able to bring a client into full disclosure. If you sense something “back there” that hovers over a client’s dreams, ask questions in a caring, non-threatening way, further opening the door for transparent communication.



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