A trio of advocates for RIAs have taken issue with the
In early March, the
"I think it's a disservice," said
Aikin said that the current fiduciary standard has core principles that have been in place for many years. The discussion shouldn’t be around how the
The fiduciary standard, Rhoades said, operates as a constraint on greed, but "the
Aikin said fi360 will respond to it, but not in the manner that the
Rallying Around the DOL
Rhoades believes the more immediate impact will be the fiduciary standard slated to come out of the
The securities industry advocates, such as SIFMA, have been putting millions of lobbying dollars to fight the DOL’s proposal, Rhoades said. He said the investment advisor community needed to match those lobbying efforts.
“I think it’s incumbent on the investment advisor community and financial planning community to react to that, to put some of their lobbying efforts in support of the DOL rulemaking process, at least to the point of, ‘Let’s get the rule out there,’” he said. “If it happens, it’s going to change the game.”
Schweiss said consumers are confused by the titles and don’t know the difference between a broker and an investment advisor, and suggested that brokers should not be called advisors, unless they are operating under a fiduciary model.
“Frankly, the industry has some shared fault in that confusion,” he said. “I will call out the press in having some share of culpability in that confusion by agreeing to call brokers advisors and making them sound all alike.”
Rhoades said that the use of the term ‘advisor’ is one factor that the courts look to when deciding fiduciary status of an individual.
“Holding yourself out as an advisor and holding yourself out as giving advice is actually an invitation to a fiduciary relationship,” Rhoades said.
“If you call yourself an advisor, how can you say you’re not a fiduciary?” asked Schweiss.
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