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Additional Testing Of Thirty Fee-Only IAs CRS Reveals The Widespread Practice of Omitting Mention Of Fiduciary Status

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Summary 

The Institute reviewed thirty randomly selected fee-only RIA CRS forms, AUMs between $1B-$3B. We reviewed each for references to its fiduciary status and whether the firm described the fiduciary standard as better/broader. From this review we found that six firms mentioned fiduciary, and two firms attempted to describe fiduciary as a better/broader standard. 

This is significant because in our prior research we found that just two of twelve fee-only firms explicitly describe fiduciary as a better/broader standard for investors”. 

Here we cite exactly how fiduciary is mentioned and described in these six CRS forms: 

As an investment adviser, Goelzer is bound by a fiduciary duty to put the interests of clients before its own. (Goelzer Investment Management) + 

When we act as your investment adviser, we are held to a fiduciary standard that requires us to place your interests ahead of ours when providing investment advice. This standard covers our entire investment advisory relationship with you (Legacy Wealth Management) + 

When we act as your investment adviser, we have a fiduciary duty to act in your best interest and not put our interest ahead of yours. (Young Richard C & Co Ltd) 

We also provide financial planning and administrative services to certain clients as part of our Family Wealth Counsel Program (FWC), which includes retirement planning, financial and tax planning, charitable planning, fiduciary trust advising, etc. (Schaper Benz & Wise Investment Council) 

When we act as your investment adviser, we have a fiduciary duty to act in your best interest and not put our interest ahead of yours. (The Retirement Planning Group) 

We are a fiduciary, registered with the Securities and Exchange Commission as an investment adviser. (Prudent Management Associates) 

. . .

Download the full paper here or below:

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