Why does a broker care if an applicant is employed and where? They just want your money. Isn't the SSN and home address enough to validate identity? Heck, I don't even need an SSN to get a driver's license anymore where I live. I assume that they only want to know because the SEC wants to know...in order to look for insider trading perhaps? Therefore, it's highly unlikely that the broker will call your employer to check up (especially since the OP does not appear to work in the financial industry). So if I were the OP, I'd just list your real employer and be done with it.
Is it dangerous not to specify that you are employed in your broker account?
- Thread starter trade5656
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I have over a million in net worth and no credit score.
Maybe you're talking about retail banks sharing credit information to each other, this has an obvious purpose to manage clients risk. But KYC procedures to know what your address is and your employment details, on an institutional / trading / investment banking side, I have never heard of any information sharing ever nor did I find any company that offer this service to financial institutions.
The best I've seen in KYC/AML is a software with an updated database of terrorists and other people under embargo.
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Exactly,WinterG; I included that[ retail-commercial US banks] sharing basic info.Also some Insurance companies use credit score; not a good way to figure risk @ all.[Unless someone has plenty of repos/late payments LOL] You are probably aware --many US property + casualty insurance companies share risk info, according to exact street address+ zip codes.......- that does make a lot of sense.
While credit score may not make intuitive sense to you, the insurance industry has uncovered an extremely high correlation which makes it a valuable indicator for them to use. If you think they're all crazy, start an insurance company that sells to those with low credit scores at the same price as those with high credit scores, you'll make a killing right? Perhaps the fact that neither you or anyone else has done so indicates that the math doesn't work out. Or maybe you've just uncovered a way to print money!
I have no comment on the "lying" part. Probably a bad idea. That said, I am self employed through my incorporated S corp (engaged in a business that is not trading related). I always dutifully report that I am self employed, net worth etc. etc., and never had any issues with any broker. I am in US obviously. Just a data point to consider.
For sure anything that uses statistical analysis on large data sets is going to throw out outliers that technically shouldn't be thrown out. Since there are probably a vanishingly low number of very wealthy people who need insurance and can't arrange for a human to underwrite it specifically for them.....
It is frustrating though. I ran into the "self-employment" ban on a home refi when I was only a year into starting my second company. Couldn't convince the pedantic underwriter that the fact that I had more than my home's value in a bank account might need to be factored into his decision making. Or convey the idiocy that if I gave away 75% of my company I would no longer be "self-employed" and he would instantly approve me despite me being immeasurably poorer and less likely to be able to pay the mortgage. Or the fact that he was already holding my existing mortgage so any risk he faced on me he was already facing! Lost his company my mortgage payment.
My entity is entirely trading related but I just had to submit a corporate resolution and articles of incorporation and was not subject to the "professional" bullets.....absolutely agree on the lying part but also with withholding what ever info which is really not their affair.
When I worked in a credit union, it was shocking how much more often people with lower credit scores had insurance claims (we had to sign off on the checks since they had a loan). Had a few people a couple months behind on their payments whose cars were stolen....miraculously was always found within a few miles of their house parked in the woods somewhere...doors locked and in good shape haha.
Insider trading, money laundering, you name it ...