Broker Check

Our Thoughts on the Fiduciary Duty Rule

| February 10, 2017
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You may have heard reports in the news recently that our newly elected President has signed an executive order pertaining to the Department of Labor’s (DOL) Fiduciary Duty Rule or “Conflict of Interest” Rule. The order requires that the DOL reanalyze the tenets of this rule, which applies only to retirement accounts administered under the Employee Retirement Income Security Act (ERISA), to ensure that it does not adversely impact the manner in which Americans can receive financial advice. I believe that certain media have unfairly characterized this action as the “rolling back” of a consumer protection rule.

At LPA Strategic Capital, we greatly support the goal of investor protection for all investor assets, not only those in the retirement savings marketplace. A client who has entered into an advisory agreement with my firm should have legal assurance that we will act in a fiduciary capacity as a result of that agreement. In the absence of such regulation, my firm and I continue to strive to do what is in the best interests of our clients in every interaction, and we are firm believers that all financial advisors should do the same. We wholeheartedly support appropriate regulation and full transparency for investors. As it currently stands, we are required to follow the rules of the SEC, FINRA, and state securities regulators, in addition to annual reviews from our broker-dealer. We are subject to both scheduled and unscheduled examinations by these agencies at any time. To be completely clear, we take the responsibility of providing financial advice very seriously.

On the other hand, there are many in the industry that believe the Fiduciary Rule set for implementation this spring could have a negative impact on the ability of some Americans - especially those of modest means - to save for retirement. This is an important point and deserves due consideration. We think the delay of implementing this rule while it is further vetted is the right decision. Our ultimate hope is that consumers and advisors alike benefit from a fiduciary standard that applies to all investment advice and is easy to understand. 

At LPA Strategic Capital, we have already expanded our staff in anticipation of more requirements, paperwork and processes. We will continue to monitor the situation and proactively adjust to meet and exceed all regulatory standards. It is a privilege to help our clients achieve their financial goals and we do not take this great trust for granted.

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