Of course, I read all the responses posted to this blog, and the e-mails I get about my column, too. But after all these years, I have to admit that I’m not nearly as concerned about whether folks agree with me or not, as I am about the points they are making; the truth is, I usually learn more from the people who disagree with me. Often, the stronger the disagreement, the more I I learn. Still, I did take notice of Steve Winks’s comment to my most recent blog (of March 15), because when Steve and I agree on something, it’s got to mean someone is in serious trouble. This time, that someone seems to be the CFP Board.
Steve agrees that the Board’s sidestepping of the fiduciary issue in order to vastly expand its role as the regulator of financial planning is troubling, to say the least. “…the proposed Financial Planner Act of 2010,” he writes, ” is just a power grab.” I agree with him when he points out that the Board has always sidestepped the inherent conflict in being both a CFP and a registered rep.
A true fiduciary duty for financial planners, Winks says, “…requires courage, as 70% of planners are within B/Ds, which because of their agency/principal relationship precludes a fiduciary standing to the consumer because of the fiduciary relationship to the B/D’s best interests.” Couldn’t have said it better myself.
In fact, that’s always been the primary problem with the CFP Board (among many others; don’t get me started): It has always stopped just short of (well, okay, often a long way from) creating a true profession of financial planning because it doesn’t want to alienate what it sees as its biggest target market–brokers. So it’s never even acknowledged the CFP/registered rep issue.
Now, when it looks like someone else might settle the issue for them–the Obama Administration and Congress–the Board comes out with yet another attempt to have and eat its cake at the same time, in the FP Act.
Under the mantra of “It’s time we finally had a profession of financial planning,” espoused by FPA president Tom Potts (as if someone’s been stopping the Board from creating one for the past 20 years) on a media call last week, the Board and its “coalition” conveniently left out anything that even vaguely resembles a profession from the Act. To my mind, it’s just another crack at a “CFP Lite,” only this time with the SEC’s sanction.