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Some financial planners who have worked with problem gambling clients caution that it is not a planner's role to judge how their clients spend their money. If they want to bet at the race track, that's their prerogative. Indeed, some clients may have the cash flow and financial resources to gamble heavily without immediately inflicting a significant detrimental impact on their lifestyle or financial goals. (Still, problem gambling is a progressive disorder and, over time, most problem gamblers will "blow" whatever cash is available to them.)
A Planner's Ethical Obligations
A financial planner does have an ethical obligation to explain the financial consequences of gambling one's money away-jeopardizing the client's ability to support a family, decreased cash flow, potential debt problems, potential taxes, less money to pass on to heirs, and so on. The CFP Board's Code of Ethics and Professional Responsibility, for example, charges CFP practitioners to "act in the interest of the client."
This raises the sticky issue of how direct to be with a client who has a gambling problem, yet who may be in denial. Some planners confront problem gambling clients and strongly encourage treatment or participation in a support group, while others fear losing client trust and confidence if they become too confrontational. Some experts recommend that at a minimum, planners in their review of a client's financial picture should note to the client that there appears to be a significant gap between income and outflow, and question where the money is going.
Planners also may find themselves in the difficult position between a gambling spouse and a nongambling spouse who may be demanding that the planner do something to seal off the gambler's access to money. As noted earlier, when dealing with a couple, it is imperative that both partners agree-to a course of action. If the two are at an impasse, you will have little success. In fact, you may be forced to drop one person to fairly serve the other. Still, recovery is a process and there may be times when the problem gambler is agreeable to sealing off, or at least limiting, his or her access to cash and assets. In fact,...