By Thomas G. Chipain / October 20, 2009 --
The hottest debate in the financial services industry is which standard should be adopted when dealing with clients and their finances- the fiduciary standard, the suitability standard or some hybrid of both. Everyone from the White House to every oversight organization, every financial magazine, newspaper and every financial advisor or industry expert, famous and not so famous, have expressed their opinion on this passionate subject. Ironically, the only groups we haven’t heard from are the big broker/dealers.
Now this Investment Advisor is throwing his hat into the ring, offering his opinion from a philosophical/moral point of view. The industry is at a crossroads; do we have the ethical fortitude to treat our clients with the same high regard that other industries do?
Let’s review; The Fiduciary Standard requires that the advisor put their client’s interests ahead of their own, their firm, commission, or product. An RIA or Registered Investment Advisor must follow this standard the “Trust” standard, the highest known in law, and fulfill critical fiduciary duties of trust and confidence and must provide its best advice.