Every client interaction lives somewhere on a sliding scale. On one end, it’s simple: a question answered, a form processed, a call resolved in five minutes. On the other end, it’s messy — an aggrieved client, a regulator’s phone call, a lawsuit. Most of what crosses an advisor’s desk sits comfortably in the middle, and most of the time, “resolved” really does mean resolved.
But somewhere on that scale, an ordinary customer service issue crosses a line and becomes something else: a reportable client complaint. Where exactly that line sits isn’t always obvious. There’s real judgment involved in deciding whether a heated phone call or a pointed email counts as a “complaint” in the regulatory sense, or whether it’s just Tuesday. That flexibility is necessary — not every unhappy client is a complaint — but it also means the line moves depending on who’s making the call.
Board reporting hasn’t caught up to that ambiguity. The standard package is familiar to anyone in risk or compliance: number of complaints, complaint types, open regulatory investigations, ongoing litigation. It’s useful information, and boards need it. But it only captures what crossed the line. It says nothing about what happened just before.
I had an experience recently that’s stuck with me. A client’s lawyer called our firm to ask questions about an issue the client was having with their advisor. The lawyer wasn’t threatening action — they were fact-finding, gathering information before deciding whether there was anything to pursue. Technically, nothing here meets the bar of a formal complaint. No allegation was made. No file was opened.
But I’d call it a near miss. A client felt strongly enough about their situation that they picked up the phone and paid a lawyer to make an inquiry on their behalf before we’d even heard there was a problem. That’s a meaningful signal, and it’s one that never shows up in a board report, because by every formal measure, nothing happened.
That’s exactly why I think risk managers and compliance officers should be capturing these moments deliberately. Not to inflate complaint statistics or create paperwork for its own sake, but because near misses are a rich source of information about how advisors, customer service teams, and compliance staff actually handle friction when it shows up. Which conversations get client relationships back on track, and which ones quietly push a client toward a lawyer, a regulator, or the door? You don’t learn that from complaint statistics alone — by the time something is a complaint, the near miss has already happened and gone unrecorded.
Now turn the question around, because this isn’t just about the organization.
If you’re a risk or compliance officer, have you had a near miss of your own — a moment where you weren’t the one being complained about, but you could feel your own name and judgment attached to how a situation was handled? A file you signed off on, a call you sat in on, a decision you didn’t push back on hard enough? Have you ever sat with a situation and asked yourself, quietly, whether it was worth the risk to you personally — to your license, your reputation, the trust you’ve built and lend to whatever organization you work for?
I don’t think that question gets asked enough, and I don’t think there’s a clean answer to it. But I suspect most people in this field have had at least one moment like that, even if it never made it into any report.
I’d be curious to hear from others in risk and compliance: do you track near misses formally, or is this something that lives only in institutional memory and hallway conversations? And has a near miss ever made you stop and think about what you were personally willing to put your name behind?
My goal is to help close the gap between corporate governance and risk/compliance management — work I’ve focused on for years and don’t believe happens in isolation. If this resonates, or doesn’t match your own experience, I’d like to hear about it. Leave a comment, or send me a direct message if you’re working through a governance or compliance challenge of your own.