More On Legal & Compliancefrom The Advisor's Professional Library
- RIAs and Customer Identification Just as RIAs owe a duty to diligently protect their clients privacy and guard against theft, firms also play a vital role in customer identification. Although RIAs are not subject to an anti-money laundering rule, securities regulators expect advisors to address these issues in their policies and procedures.
- Client Communication and Miscommunication RIA policies and procedures must specify what type of communications should be retained. The safest course of action is for RIAs to retain all communicationsto clients, from clients, and about client accounts. To comply with fiduciary obligations, communications must be thorough and not mislead.
The Committee for the Fiduciary Standard, which includes WealthManagerWeb.com Editor in Chief Kate McBride, held face-to-face-meetings with two SEC Commissioners, Congressional staffers, and a Treasury Department official on July 29 to discuss the Committee's five fiduciary principles. McBride and fellow Committee members Knut Rostad, Harold Evensky, Sheryl Garrett, Tom Bradley, and others met for more than an hour each with SEC Commissioners Elisse Walter and Luis Aguilar, at the Commissioners' invitations, in SEC headquarters in Washington.
Afterward, committee members also met with staffers from the House Education and Labor Committee, and with a Treasury Department official, over the Committee's call on Congress to include an "authentic fiduciary standard" in any financial services re-regulation promulgated by the Obama Administration.
"The authentic fiduciary standard and five core fiduciary principles have generated a great deal of interest among the regulators and legislators who invited the Committee to these meetings," said McBride.
Evensky, president of the wealth management firm Evensky & Katz in Coral Gables, Florida, noted that "We felt strong interest from everyone we met. Although no specific commitments were made, our takeaway was that all participants understand and believe in the application of the five core fiduciary principles to any and all who provide (or purport to provide) investment advice."
"We saw Washington at its very best," said Rostad, who chairs the Committee. "The keen sense of how critical the fiduciary standard is to regulatory reform, and the historic opportunity to 'Do what's right for investors' was palpable in our meetings." Rostad is regulatory and compliance officer at the Falls Church, Virginia, RIA firm Rembert Pendleton Jackson.
He blogs on the fiduciary issue at Investment Advisor sister publication WealthManagerWeb.com.