Updated Thursday, October 23, 2014 as of 2:00 PM ET

Do Independent Advisors Oppose Expected DoL Fiduciary Rule?

As the midterm elections approach and the debate around the Department of Labor's expected fiduciary proposal rages on, advisors will be paying attention to Washington.

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Comments (5)
The answer you get depends, of course on the question you ask. It is fascinating that FSI can be so confident that the DOL regulations would ban commissions, none of us know what is in them. The regulations have not be released, but the DOL has repeatedly stated that the regulations will not ban commissions. Still, FSI insists on pretending that this is an issue.

Could it be that their real concern might be that those advising the public might actually be required to put the interest of their clients ahead of the best interests of the BDs? Of course they can't say that, so its easier to set up a "straw man" to throw punches at.
Posted by David M | Friday, July 11 2014 at 1:18PM ET
I don't think that one could suggest that charging a commission is not putting the clients interest first. Is charging somebody over 1% on their assets invested actually saving them money?
I have both a fee-based and retail business, and for somebody trying to build assets, charging them a load, whether front or back, charges them much less money 15, 20, and 30 years later, particularly when they are using mutual funds primarily as their security.
This should not be a conversation directed solely at the unethical advisors or brokers in our industry.
Posted by David C | Friday, July 11 2014 at 6:14PM ET
I don't think that one could suggest that charging a commission is not putting the clients interest first. Is charging somebody over 1% on their assets invested actually saving them money?
I have both a fee-based and retail business, and for somebody trying to build assets, charging them a load, whether front or back, charges them much less money 15, 20, and 30 years later, particularly when they are using mutual funds primarily as their security.
This should not be a conversation directed solely at the unethical advisors or brokers in our industry.
Posted by David C | Friday, July 11 2014 at 6:14PM ET
The brokerage industry has successfully thwarted advisory services innovation principally based on its a terribly uninformed understanding of fiduciary duty. On going fiduciary duty requires the broker and the industry to be accountable for their recommendations and simply act in the consumer's best interest on an ongoing basis as required by statute. Why shouldn't retail investors (who need the most help)have the same consumer protections as all other investors? The absence of broker accountability and responsibility clearly subordinates the best interest of the investing public to that of the broker/dealer. So, should we be surprised that the independent broker/dealer trade association survey found that the consumer's best interest are irrelevant, if there is a choice in serving the best interest of the independent broker/dealer?

Independent brokers should be ashamed of these findings, and RIAs certainly should be forewarned of the culture and the institutionalized advisory services inefficiencies in the independent space that are counter to the best interest of the consumer and the professional standing of the broker.

SCW
Posted by Stephen W | Monday, July 14 2014 at 10:47AM ET
Why shouldn't retail investors (who need the most help)have the same consumer protections as all other investors? The absence of broker accountability and responsibility clearly subordinates the best interest of the investing public to that of the broker/dealer. So, should we be surprised that the independent broker/dealer trade association survey found that the consumer's best interest are irrelevant, if there is a choice in serving the best interest of the independent broker/dealer?

Independent brokers should be ashamed of these findings, and RIAs certainly should be forewarned of the culture and the institutionalized advisory services inefficiencies in the independent space that are counter to the best interest of the consumer and the professional standing of the broker.

SCW
Posted by Stephen W | Monday, July 14 2014 at 10:48AM ET
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