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WEALTH TALK America: Focus On Regulation Best Interest

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This conversation originally appeared on Family Wealth Report on July 31.

As part of Family Wealth Report’s series of Wealth Talk videos, we speak to a prominent US wealth management industry figure about the Regulation Best Interest legislation, and why he is concerned about how it will not improve fiduciary standards, as framers claim.

The sweeping new set of rules on US wealth management known as Regulation Best Interest are controversial. Last June, the US Security and Exchange Commission supported the Regulation Best Interest rule, and supported other actions to improve disclosures and clarify advisors’ responsibilities. The rules follow a failed attempt by the Department of Labor to enact a fiduciary rule that would have introduced a “best interest” test of how financial advice is provided. However, senior wealth management industry figures have criticized the SEC rule as diverging form the existing fiduciary standard required of registered investment advisors. 

One such critic is Knut Rostad, who is president at Institute for the Fiduciary Standard. He also wrote about the issue at Family Wealth Report on July 15. We have run this discussion as an audio-only podcast.

Dan Moisand

 

Dan Moisand is a nationally recognized fiduciary fee-only financial planner, an Institute Real Fiduciary™ Advisor and Chair-elect of the CFP Board.

The Institute has enshrined the ‘Moisand Rule’ on fiduciary practices. It is basic and is more important today than ever: “You have to avoid conflicts. If I avoid a conflict, I don’t worry about it.”

Watch the video of Moisand speaking here.

Bob Veres

 

Bob Veres is a long term observer of financial planning. His Newsletter, “Inside information” Is a staple of leading planners. In the May edition he writes about fiduciary and the Institute.

"But a much bigger point is that the fiduciary standard—as Knut Rostad of the Institute for the Fiduciary Standard has pointed out—has been determined by the Supreme Court (1963 ruling) to be at the very heart of the Investment Advisers Act of 1940. It is the foundation of what it means to be an RIA registered with the SEC instead of a tipster or a tout."

- Bob Veres, Parting Thoughts ... The SEC's Own Compliance Culture