At most advisor conferences, you can expect to hear speakers opine about the markets and the economy, to get practice management tips from consultants and peers, to receive retirement, tax and estate planning tips and to get updates from the conference sponsor about the state of their business. Oh, and there will usually be at least one session on compliance. All of that was in evidence at the first annual Shareholders Service Group national conference, being held in San Diego Wednesday through Friday of this week, but with a twist.
Compliance and the current state of advisor regulation was not a side issue at the SSG conference. It was front and center at the conference beginning with CEO Peter Mangan’s welcoming address to the nearly 300 people in attendance at the conference, to former Schwab and Fidelity RIA chief Charles Goldman’s speech and, no doubt, to the getaway session featuring inside-the-beltway expert Greg Valliere on Friday.
Mangan brought up the trust and fiduciary issue on Wednesday, suggesting that independent RIAs, including those affiliated with SSG, had an advantage with clients over the wirehouses and ‘advisors’ of other big institutions because of their trust-building fiduciary approach to serving clients. He also suggested that if FINRA really wanted to be the SRO for advisors that it might do well to oversee the corporate RIAs and the dually registered reps of broker-dealers rather than independent RIAs.
Goldman, now a consultant, addressed the possibility of a universal fiduciary standard for all advice-givers, but argued that it “would be criminal and unfortunate” if such an extended standard became rules-based, as the advocacy groups for brokers have suggested, rather than the principles-based fiduciary rule that RIAs have always operated under.
Some 75 or so of the 215 advisors at the conference attended a breakout compliance session on Thursday moderated by this AdvisorOne editor titled, “A Year in the (Compliance) Life of an Advisor.” What is the current state of Dodd-Frank implementation? According to Kelli Capitano of National Compliance Serves, the SEC has taken about 75% of the steps required under the landmark 2010 Wall Street Reform and Consumer Protection Act, but some key issues remain unresolved. Among those unresolved issues were some pretty big ones, notably the possible extension of a fiduciary standard to brokers and a decision on whether there should be an SRO to oversee RIAs, said Capitano, an attorney who is VP of Investment adviser services at National Compliance Services Inc.