CA Advocacy
Issue Background

Fiduciary Standard

FPA seeks legislative reform that would require financial service providers who hold themselves out as “financial planners” to meet competency standards and to provide financial planning services at a fiduciary standard of care.

A uniform fiduciary duty standard for both broker-dealers and investment advisers when providing personalized investment advice to retail customers was contemplated by Section 913 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

This standard should be based upon the core principle that, when providing personalized investment advice to retail customers, a financial adviser (however registered) always must act in the best interests of those customers. The SEC should adopt this uniform fiduciary standard immediately. It is not necessary for the SEC to harmonize other aspects of broker-dealer and investment adviser regulation before acting to adopt a uniform fiduciary standard. The SEC should not delay the adoption of a uniform fiduciary standard while it considers harmonization initiatives.

The “best interest of the customer” standard should be the key feature of any uniform fiduciary standard of care.