Safeguards

There are a number of controls Abacus has implemented internally and externally to reduce risks to our clients. These include:

Abacus is regulated by the SEC and is subject to routine and surprise examinations. We are not afforded any special treatment or consideration when they decide to pay us a visit.

As a Fee-Only registered investment advisor, Abacus is compensated solely by its clients and takes a fiduciary oath to treat our clients’ assets with the same care and prudence that we do our own. Neither Abacus, nor any of its principals or related divisions or companies receive any fees from product sponsors. Our only financial incentive is to act in the best interests of our clients, which we have been doing for the past 20 years.

We use third-party due-diligence firms to help us ascertain the viability of any private equity and real estate funds in which we invest, as they will have custody of client assets. This due diligence includes background checks, review of sponsor reputations in the industry and competitive position of the intended investment

We diversify our portfolios with the aim of reducing the overall effect of a single investment losing 100% of its value (e.g., Madoff, Stanford, Lehman Bros.).

Because the bulk of our clients’ assets are placed with either TD Ameritrade or Schwab Institutional, it is important that our prospective clients understand the mechanics of these relationships:

These custodians have established various controls that prevent Abacus or its employees from obtaining access to client funds and securities. Any movement of funds or securities out of a client’s account requires written client authorization. Third party custodians also provide independent reporting to clients on a monthly and/or quarterly basis so that clients can independently verify the security of their assets, and online access is available 24/7.

All accounts are required by the Government to be insured by the SIPC in the event of Broker-Dealer failure. Both custodians also have supplemental insurance. For Schwab, there is coverage through Lloyd’s of London which protects up to $600 million in aggregate ($150 million per customer). For TD Ameritrade, coverage through London insurers protect up to $250 million in aggregate ($150 million per customer).

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