How to avoid giving free advice to prospects

I’m reminded of the old sex education message: Just say ‘no’!

As professional advisers we are all used to prospective clients seeking free advice. As I’m no longer in practice and as a frequent blogger I have very different perspective now. So here is some free advice from me.  When a stranger/prospect calls you need to set clear parameters. Why give any free advice?

I think the most common reason accountants give themselves is that it helps evidence their credibility, style, approach, knowledge and willingness to help clients.  In reality it is only the accountant themselves who doubts their ability and knowledge. The prospect generally takes all that for granted – after all our adverts or website makes clear we’re an accountant. All accountants know everything don’t they? We know this isn’t the case but prospects assume it is so.  Even more so if they have been recommended or referred by a third party.

So accountants are generally proving nothing by giving free advice. They can evidence the other key qualities they want to exhibit without giving free technical advice.

I also tend to think that a side benefit of the Anti-Money Laundering (AML) legislation is that it gives accountants a statutory justification for any apparent reluctance to provide answers to technical questions before engaging a new client.  “I’m really sorry Mr/Ms Prospect but as a professional adviser I’m precluded by law from giving any advice before we’ve been through the anti-money laundering checks. I know it’s a pain but it’s the law.” The consequence of this will often be that you have engaged the client and secured their agreement to your preferred billing procedures before you give them any valuable advice. So the AML laws do have an upside after all!

Finally I would suggest you establish a process to qualify a prospect or to let them go elsewhere before you waste too much time on them. Initially you may want to qualify out time wasters on the phone. You will also want to determine what you need to cover in an initial meeting.

In many of my seminars I ask accountants if they offer a free initial meeting to prospective clients. Typically the answer is ‘yes’. “How long do you allow for such meetings?” Some put a cap on it. Others say ‘as long as it takes’. I ask the question – “As long as WHAT takes?” It’s not just about getting the prospect to want to appoint you. You need to find out quite early on if they can afford to pay the fees you would want to earn. You also need to determine if this is the sort of person you want to have a client.

Bottom line, I’d suggest you establish a process/checklist (that you will in time commit to memory) to use when you receive such calls in future and indeed when you have an initial meeting with a prospect.

By |2018-10-09T18:39:27+00:00March 9th, 2010|Accountants, Productivity, Speaking|

About the Author:

Mark Lee FCA is an accountancy focused futurist, influencer, speaker, mentor, author and debunker.


  1. Krupo 11th March 2010 at 1:02 am - Reply

    Good advice – big firms have rather strict client acceptance procedures – I can see that easily being overlooked in smaller shops.

  2. Aziz Sattar 15th March 2010 at 12:33 pm - Reply

    Great blog post Mark. I like using MLR as way out to provide free advice. My only concern some good clients may slip the net.

    This area is so difficult.

  3. Paul Simister 15th March 2010 at 12:45 pm - Reply

    Interesting point of view Mark and I thought I was going to disagree with you.

    I guess there is a big difference between general advice and tips and specific advice that leads to action.

    It’s important you don’t appear difficult and unhelpful as that will create a very bad impression.

    Since one of the important factors in a client deciding to engage one accountant over another is the ability to communicate in a way the client can understand, I think accountants should be prepared to discuss general topics and options

    I completely agree with you about qualifying hard and the objectives of the initial meeting.

  4. Alan Kennedy 25th August 2013 at 4:23 pm - Reply

    Mark – I am not sure I agree with your comments on the AML rules. The rules require us to carry out customer due diligence before entering into a business relationship with a client. As business relationships are defined as those relationships that are expected to have an “element of duration” and I do not expect any of my relationships to have an element of duration until a fee basis has been agreed AML rules will not apply. In addition to that most clients want confidentiality in the initial meeting so if asking for a view on something that could potentially be illegal (eg non submission of tax returns) the accountant would do as well to explain both the anti money laundering rules and also the protection afforded for clients seeking “legal advice” (section 7.34 of the ccab aml guidance refers). That way we can have a free and full exchange of information for clients seeking help. This is particularly important for clients behind on their tax affairs or in desperate financial difficulty.

    • bookmarklee 25th August 2013 at 4:54 pm - Reply

      Thanks Alan. Interesting approach. Not sure it accords with the Institute’s guidance though.

  5. Alan Kennedy 25th August 2013 at 6:09 pm - Reply

    Of course it accords with the institutes guidance! I spent a happy hour reading it just to be sure. At the risk of not winning an INABA prize you need to look at the small print of the guidance to be certain (it reminded me of my days of reading tax statute!)

    The key parts are
    From the glossary

    “which is expected by the relevant person, at the time when the contact is established, to have an element of duration”

    From 5.8
    Identification and verification of identity procedures (together termed as “ID
    procedures”) should normally be completed before entering into a
    business relationship. This applies also to occasional transactions.

    I therefore consider that there is a lacuna in the guidance because 5.8 requires the CDD to be undertaken before entering into the business relationship but glossary defines business relationship as something with an element of longevity and you can’t possibly know whether there is longevity until you have asked the client that famous question “how can I help you”.

    This presumably is why section 5.9 is included in the guidance

    “The 2007 Regulations allow for completion of ID procedures ’during the establishment of a business relationship rather than before if the measures are completed as soon as practicable after the initial contact but only when such a process is necessary not to interrupt the normal conduct of business and there is little risk of money laundering or terrorist financing occurring.”

    If you ask potential clients to produce ID before discussing the services to be provided this would interfere with the normal course of business relationships as otherwise I might be forced to ask every person who meets me at a party (or networking event) that asks me for free tax advice to produce ID! In all these circumstances I usually start with the cavaet “in general terms” because I can’t give specific advice.

    If we look at what the money laundering legislation was designed to prevent it is money laundering! The fact we cannot and should not file SAR when clients seek legal advice means the failure to do CDD until we have agreed the fee will not its self increase crime hence risk of money laundering. As you know I used to lecture on the Money Laundering regulations 2007 (many years ago now!) and encouraged clients to adopt a risk based approach. I also took the view that CDD did not apply to one off meeting because there was no expectation of longevity.

    I appreciate that there are no black and white rules to be applied where and I would always advise accountants document the thought process and to complete customer due diligence before starting work. One firm nicely summed it up when – we do not give out charge codes until we have seen the customer ID!

    From a practical viewpoint I would also usually visit clients in their premises so often they did not have photocopiers so it made doing ID on the first visit difficult. I would therefore make sure that I got the ID soon afterwards (often by using a database as that is the only sure way of making sure they are not a terrorist or on the prohibited persons list because they are a relation of Robert Mugabe!) Hope that is helpful.


    PS Do I still win a prize in the INABA competition. I have a whole series of jokes that I used to crack in my Money laundering lecturers if you want further evidence of lack of a boring nature.

  6. bookmarklee 29th August 2013 at 5:10 pm - Reply

    As to the ICAEW guidance, you clearly want to interpret it to allow you to give advice before you have verified a prospect’s identity. I think that is a dangerous approach and that the rules are set out to discourage it. So I stand by my advice in the blog post.

    As you say 5.8 clearly states:
    “Identification and verification of identity procedures (together termed as “ID
    procedures”) should normally be completed before entering into a
    business relationship

    Indeed you go on to say, and I agree, that accountants should “complete customer due diligence before starting work”.

    I accept that your interpretation is legitimate and allows you to operate in the way you choose. If I were in practice though, for the reasons stated in the blog post, it is not the approach I would choose to follow.

  7. Alan Kennedy 27th May 2018 at 8:33 am - Reply

    I have just re read this blog post and the other point is that we are not allowed to give specific advice to a client before obtaining professional clearance and can only make general comments. As the business relationship cannot start until we have the clearance I am safe but I take your point, Much more important however is your point about time wasters. It is very difficult to be compliant if you do not charge enough or give away to much time. I will be a bit more careful in future!

Leave A Comment