In my column that’s coming out in the July issue of Investment Advisor, I write of what I learned about Mercer Bullard’s SRO for RIAs—the Self Regulatory Organization for Independent Investment Advisors—at the fi360 conference in San Antonio in May, and why it’s important for independent advisors, everywhere. Without going into all the details in the column, and not to be overly melodramatic, I’ve come to suspect that the current debate in Washington about who’s going to regulate RIAs may well determine the survival of independent financial advice.
As some of you may remember, independent advice has been a burr under the saddle of the securities industry since its emergence in the early 1980s. In wirehouse circles, the old IAFP (a forerunner of the FPA) was snidely referred to the as the “International Association of Failed Producers.” Yet, those “failed producers” continued to gain market share; so much so, that in the mid-80s, the NASD (FINRA’s predecessor) was actively lobbying to take over the regulation of financial planners.
Of course, the NASD/FINRA lost that battle when the SEC recognized the newly formed CFP Board (initially called the IBCFP) as the SRO for financial planners, and independent advice continued to snowball. In recent years, the ranks of independent advisors have swollen at an unprecedented rate from the flood of breakaway brokers in the wake of the 2008 Wall Street