Investors are not confused. They do not lack the capacity to think through the information they are given. They are not “forgetful.” However, they do misunderstand how brokers and advisers differ because the information they get from the industry is unclear or misleading.
White Papers
Study Offers New Insights and Guidance for Reg BI
New research white paper by Knut A. Rostad and Darren M. Fogarty: SEC Office of the Investor Advocate / RAND study offers new insights into retail investor, financial reps misunderstandings of brokers and advisers; study offers guidance for Reg BI. View complete paper
Financial Firms’ Steps Toward Fiduciary Are Significant; Are They Enough and Will They Stay Intact?
In 2016 and 2017, the Consumer Federation of America reported in three separate comment letters that 34 financial firms changed their products and/or product offerings to comply with the DOL Fiduciary Rule. They did so against a backdrop of industry criticism that the Rule would be harmful not only to their own business models, but to their customers and clients as well. Some of the very same firms heftily contributed to that backdrop. However, in announcing their new products and offerings, many of these same firms reversed their position on the impact on investors. Now, they believe such changes are overdue, prudent, and beneficial to customers. Why the switch? And will such product improvements survive the recent vacatur of the DOL Rule? Time will tell.
Why Avoiding Conflicts of Interest Matters
Advisor DNA found in the Advisers Act of 1940 and championed for generations is objective advice. Yet, some reject this bedrock principle.
CFPB Standards: “The Ethical Foundation for CFP Certifications”
CFPB is reviewing its “Ethical foundation for CFP certification.” This review is timely. The advice market is undergoing a basic transformation. New technologies, the DOL Rule, more demanding investors and lowering costs are change agents. Higher ethical standards are in demand. CFPB should answer the call and lead.
What Investors Can Learn About An Advisor’s Conflicts in Form ADV: ‘But Were Not Sure How to Ask’
RIAs DNA of objective investment advice is embedded in the Advisers Act of 1940. What’s often over-looked, however, are differences among RIAs on measures in the Adviser’s Form ADV that serve as ‘fiduciary indicators’. The research identifies some of these indicators and explores some of these differences.
