Brah-
You need to punt this to a legit financial planner. The interests being served here are yours and the banks for sure, and maybe the client.
Your boy wants you to do it because its good for his bank and probably him. You want to do it to pop a bottle or buy Warcraft gold or give to charity or whatever.
Your reputation and that of the institute you represent (and all of us fellow charter holders) is worth more than this. If you’re going to do it, your caveats should be more frank, and you should disclose that you have not evaluated the investment in the context of the clients portfolio, objectives, and constraints.
That could be hard because you want to help your boy and make a few duckets, but its the right thing to do.
Do you have a compliance professional in your firm to adress this with? If you are an independent, perhaps the institute has a “hotline” that can address this more conclusively. I believe this thread has actually done a pretty good job of the task, and if I were you I would lean against doing it based on what has been pointed out. It appears your client has hired you to cover its bases and follow the letter of the low and not the spirit. The fact that a judge is involved (and you should know these circumstances pretty well to proceed cautiously) raises flags. Even more flags are raised in my eyes from a simple circumstance: the prospective annuitant actually does not have a retained financial planner, and is therefore either (1) a layman being sold a product and has not been alerted that he/she needs to have one involved or (2) someone who believes self to be fairly up to the task. The fact that a judge has been involved raises suspicions with regard to the “gravity” of the situation. And indeed, the level of expertise you have so far provided does not go far enough to contribute to the safety margin the judge intends by his order. Sorry if I am repackaging what has already been said, but my opinion is to turn down the assignment.
You’ve probably either decided to take the assignment or not already, but here’s a little tidbit I just received.
Speaking of Daubert challenges (see item above), a new court ruling serves as a warning to valuation analysts who testify outside their range of expertise. A federal trial court recently severely limited a financial expert’s testimony because of his lack of qualifications. Often, an expert is deemed qualified and then the expert’s methodology is challenged, but that’s not what happened here.
_ Don’t go there: In the SEC’s current trial against a former Goldman Sachs trader, Fabrice (aka Fabulous Fab) Tourre , Tourre brought in an expert to testify about collateralized debt obligations (CDOs). The trouble was the expert had no experience with CDOs. While he was an expert at structured finance, he was more of an economic generalist and also a “professional testifying expert,” as the court put it. In pretrial Daubert proceedings, the court ruled the expert is “not qualified to present this opinion” about CDOs. “Being a professional testifying expert in the financial area does not give an individual the qualifications to opine in every financial area as to every type of analysis,” the court said._