After 25 years as a financial journalist, I’ve received more than a few “responses” to my writing, such as the one recently posted on Investmentadvisor.com by the Financial Planning Coalition about my September Column: “The Dog That Didn’t Bark.”(http://www.investmentadvisor.com/Issues/2009/October%202009/Pages/The-Dog-That-Didnt-Bark.aspx) Yet, I still must confess to being somewhat at loss when such responses start out critically, but then to confirm the very points with which they seemed to disagree so vehemently.
The Coalition’s response is a perfect example. It starts out stating that my column: “…provides an inaccurate and misleading review of the Financial Planning Coalition’s goals for reregulation of the financial services industry. As a result, the column is a dog that’s barking up the wrong tree.”
Yet, in addition to that nice turn of phrase with the “wrong tree” line, somewhat puzzlingly, the Coalition’s response goes on to emphasize the main points of my column. The first is that while announcing it’s “support” for a “fiduciary standard” for advisors (as has FINRA and SIFMA), it has taken no further steps spell out what might be entailed in such a duty nor to oppose the securities industry’s myriad and seductively misleading attempts to affect a vastly watered down version of the fiduciary standard in pending legislation and/or regulation. Combined with it’s implied acceptance of the CFP Board’s version of fiduciary duty–which includes the same advisors wearing multiple (fiduciary and non-fiduciary) hats and product lists limited by employers–in my mind, and that of many others, the Coalition’s position is pretty hard to distinguish from FINRA and SIFMA.
So, instead of joining the fiduciary fray–other than to say: “Oh, we’re for it”–the Coalition spends the majority of its efforts (and the content of it’s response) on attempts to shift the debate to the regulation of financial planning: “A bona fide fiduciary duty is a key component of the Coalition’s proposal for a national oversight board for financial planners… …Such criticism overlooks the unique role the Coalition plays – representing the leading financial planning organizations uniquely positioned to address consumer protection issues as they relate to the financial planning profession.”
Then, in what maybe the quintessential definition of character, the Coalition spells out its strategy for working within “the reality of today’s financial services regulation,” once again worthy of FINRA: “The [regulatory] gap is most glaring when it involves the delivery of broad-based financial advice–or financial planning–to the public. It is this gap we want to eliminate.”
Let’s get this straight: There are about 1,000,000 registered reps and insurance agents in the US, most of whom are salespeople who want their clients to think they are “advisors,” we have our first legitimate chance to fix this “confusion,” the securities industry is aligned behind a non-solution, and the “most glaring” problem we have is financial planning?? When they update Webster’s, they’ll undoubtedly put of picture of the Financial Planning Coalition under “group think.”