HOW TOM HANKS (THE MOST TRUSTED AMERICAN) GOT CHEATED BY HIS INSURANCE ADVISOR

Survey says … the most trusted public person in the US is Tom Hanks. That’s according to Readers Digest this month.

Why Tom?

How would the public know if Tom is trustworthy?

It’s not as if they know him personally. Still, they perceive him as trustworthy and that becomes their reality. Tom seems likeable and usually plays a “good guy” in movies.

What Happened?

How did Tom think he got cheated? His insurance advisor (Jerry B Goldman) charged more than list price for coverage for 13 years (1998 to 2011).

This was not obvious  the invoices — inflated by up to 600% — were on the advisor’s letterhead. For some unexplained  reason payments were made to the advisor instead of directly to the insurers. The advisor remitted the correct premiums and kept the rest.

Tom and his wife Rita Wilson claimed a loss of over $316,000. Other clients were also tricked leading to total alleged losses of $800,000.

Wouldn’t you want copies of your insurance policies? The advisor provided copies of the real policies but blacked out (redacted) the premiums. Why didn’t that raise questions?

The Detective

The discrepancies were uncovered by Tom’s new insurance advisor who was concerned that the premiums looked too high.
Why weren’t the problems discovered earlier?

The accountant — often the most trusted financial advisor — might have recommended an independent review of the coverage and premiums. Or questioned why premiums were not going directly to the insurers. Or asked to see the insurance policies without redaction.

Outcome

The advisor agreed to plead guilty. Unfortunately, the details are behind the law360 paywall.

Lessons

As we know, the untrustworthy take advantage of others. However, being trustworthy doesn’t help you detect the untrustworthy. You might even be easier to fool if you treat others as innocent until proven guilty.

Advisors are actors too. You’re seeing a performance they’ve perfected over the years. That doesn’t mean they are the character they portray. Unless you see them again and again with different clients in different situations, how could you possible know?

Tom Hanks has facial characteristics give the appearance of trustworthiness (click on the photo to read the article for explanations). Looks deceive. I can’t find photos of Tom’s advisor online. Maybe he also had the right look?
Assuming someone is trustworthy because you like them is risky.

Chemistry easily fools people. Divorce is evidence. So much for “till death do us part”.

Don’t follow others because they can be fooled too. It’s easy to fool some of the people some of the time. In that state, they may fool others unintentionally. We still fall for magic tricks even though we know they’re tricks. The advisor also fooled

• Andy Summers, guitarist for The Police
• Sam Raimi, director of Spider-Man 3

Insurance comes from an insurer not an intermediary like an advisor. Get statements directly from the insurer. Make payments directly to the insurer.

The World’s A Stage

Not all actors are on the stage or screen. You meet some in person and you can’t always tell they’re performing — and for their benefit.

Links

• Actor's insurance broker lands in jail (Nov 5, 2013) (new)
• The 100 most trusted people in America (Reader’s Digest, Jun 2013)
• Fan photo offers definitive proof that Tom Hanks is truly awesome (Gawker)
• Insurance broker charged with defrauding Tom Hanks (The Guardian, Nov 2012)
• Tom Hanks victimized in alleged insurance scam (insurancequotes.com)
• Sam Raimi sues insurance broker for fraud (Hollywood Reporter, Nov 2012)
• Should you change advisors when you move?
• Imagine your advisor winning an Oscar
• The foolproof measure of trust

Podcast 224

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PS  Readers Digest removed the three most trusted from the list: your own doctor, your own spiritual advisor and your own child’s current teacher.