More On Legal & Compliancefrom The Advisor's Professional Library
- The Need for Thorough and Effective Policies and Procedures Whethere an advisor is SEC or state-registered, RIAs must revise their policies and procedures to address significant compliance problems occurring during the year, changes in business arrangements, and regulatory developments.
- The Few and the Proud: Chief Compliance Officers CCOs make significant contributions to success of an RIA, designing and implementing compliance programs that prevent, detect and correct securities law violations. When major compliance problems occur at firms, CCOs will likely receive regulatory consequences.
Significant and relevant organizations will have success and, in turn, attract supporters—as well as critics. The Financial Planning Association (FPA) is no stranger to either group.
While FPA’s leadership has continuously and consistently shared the true stories behind the “stories,” there will always be those who weren’t part of the inner workings of FPA and yet gleefully dredge up muddled accounts of past events, craft their assumptions as gospel and put it forth as news. To be clear, we are not talking about the objective reporting that is the standard practice of the vast majority of trade publications, including this one. It is more the secular blogger, infrequent contributor to the established media and self-anointed “watchdog” for the industry. They manufacture feuds where there are none and when you read closely, you’ll notice these are one-sided accounts without a single fact check or interview with the organizations involved.
Does this come with the territory of being the largest membership organization for financial planning in the U.S.? Absolutely. However, it also means we have the right to provide our view of the world and the facts, especially around lingering discussions regarding FPA’s relationship with the broker-dealer community.
FPA aspires to be the best client-centered association in the country, with corporate members that support the financial planning process. In 2004, FPA paved the way with financial and logistical support for its broker-dealer division to become a standalone organization called the Financial Services Institute (FSI). In discussions between FPA and its broker-dealer advisory council, the leadership of both agreed that FPA’s bylaws and core focus on developing financial planning as a profession conflicted with the desire of the broker-dealer community to have undivided attention before the NASD, Congress and others over issues involving their distribution channel.
Since the organizational separation, there is no lingering feud or regret. Instead there is ongoing communication that is typical of two groups that have mutual respect and frank discussions regarding important issues. Indeed, both FPA and FSI have come out in favor of holding broker-dealers to a fiduciary standard when giving advice. FPA embraces a traditional fiduciary standard of care as the best way to meet client needs. Our belief is spelled out in the widely respected FPA Standard of Care, a requirement for all of our practitioner members. And as many know, any fiduciary rulemaking created by the
Another area where FPA is solidly grounded is our belief that financial planning is a true profession. To be sure, the pipeline of suitable investment, insurance and other financial products is vital to the success of the financial planning process, but the interests of suppliers and professionals are typically represented by different organizations.
FPA remains the largest membership representative of the overall financial planning profession and, despite the unprecedented economic challenges of the past few years, we have persevered and come to a place where numbers have stabilized. Our recent FPA Experience conference was on-par in attendance compared to last year’s event. FPA membership retention is back to the previously high levels experienced prior to the 2008 economic downturn and acquisition of new members continues on a positive trend each month. Our financial foundation is strong and in keeping with a conservative and prudent management of our budgets which still allow for innovative programs, initiatives and conferences.
Every one of our members is voluntarily part of FPA and desires to be involved in a community which goes beyond a title, or mark, or compensation model. They know they will find others who are just like them, but also easy access to professionals from all backgrounds, experiences and business models. In common, they all agree to adhere to the highest standards of professional competence, ethical conduct and clear, complete disclosure to those they serve.
This is what truly sets FPA apart from any other organization.
Martin F. Kurtz, CFP, AIFA Marvin W. Tuttle, Jr., CAE
2011 President Executive Director / CEO
Financial Planning Association Financial Planning Association