FREE NEWSLETTER

Trust but Verify

Dennis Friedman  |  August 7, 2020

WHEN I WAS in my 20s, I joined a large aerospace company. It was my first job out of college. I was an employee who thought all my colleagues were team players working toward the best interest of the company.

Back then, I’d never heard of the term “office politics.” But Ron, my boss, took it to a whole new level. He was an expert at manipulating people.

Ron joined the company a year after I did. He was outgoing and, at the time, studying to be a lawyer. But there was something about him that gave you an uncomfortable feeling. He was always trying to impress you and sometimes his comments seemed deliberately misleading.

One day, I approached Ron about a pay raise. I told him that, since I had assumed more responsibilities and exceeded all my workplace goals, I deserved more compensation. Ron agreed and said he would submit the paperwork for my pay raise.

After weeks went by, Ron informed me that Bill, the department manager, turned down my raise. Ron assured me, however, that he would keep trying. This went on for a while, with Ron telling me that Bill was refusing to sign off on the paperwork.

I was dismayed and frustrated with the way things were going, and I decided to resign. I felt that, since upper management wasn’t satisfied with my performance, I should seek employment elsewhere. Ron said he was sorry to see me go, but he understood.

A few days after I gave notice, I was approached by Bill about my resignation. He informed me that Ron never put me in for a pay raise. Clearly, Ron was trying to con me into quitting my job.

After my conversation with Bill, I received the pay raise. I also remained with the company for many years, while receiving a number of promotions along the way. I wasn’t aware that Ron was ever disciplined for his actions. He was my boss for a few more years, and then worked on special assignments for the department manager. He left the company after receiving his law degree.

Many years later, I learned Ron was convicted of owning and operating a mortgage modification company that falsely promised to save people’s homes during the Great Recession. He was sentenced to 7½ years in prison for charging upfront fees in return for mortgage modifications that seldom happened.

According to one report, his company took some $2.7 million from hundreds of clients and won mortgage modifications for less than 5% of them. Ron also claimed to be a lawyer, when actually he was disbarred.

I’ve often thought about how much my life would have changed if Ron had been successful in getting rid of me. I was a college graduate with a degree in history and no marketable skills. One dishonest person could have wrecked my life.

Have you ever heard the phrase “trust, but verify”? Trust is important, but blind trust can be abused. I learned that the hard way from Ron.

You should never blindly trust your boss, financial advisor, broker or anyone else who has some control over your financial well-being. For instance, when choosing a financial advisor, choose someone with reputable credentials, such as the Chartered Financial Analyst or Certified Financial Planner designation. Alternatively, look for someone who’s a member of the National Association of Personal Financial Advisors, the organization of fee-only advisors. Then monitor his or her performance carefully by reviewing your quarterly financial statements.

Dennis Friedman retired from Boeing Satellite Systems after a 30-year career in manufacturing. Born in Ohio, Dennis is a California transplant with a bachelor’s degree in history and an MBA. A self-described “humble investor,” he likes reading historical novels and about personal finance. His previous articles include No VacationChanging My Mind and Error of My Ways. Follow Dennis on Twitter @DMFrie.

Do you enjoy HumbleDollar? Please support our work with a donation. Want to receive daily email alerts about new articles? Click here. How about getting our weekly newsletter? Sign up now.

Free Newsletter

SHARE