November 14, 2013
Elizabeth M. Murphy
Secretary, Securities and Exchange Commission
Dear Ms. Murphy:
The Derivative Project appreciates the opportunity to resubmit Petition for Rule Making, SEC File #4-648 originally submitted to the SEC on April 3, 2012 for consideration by the SEC Dodd-Frank Investor Advisory Committee, as it relates to their November 22, 2013 Agenda on a "fiduciary standard for broker-dealers."
Attached is the April 12, 2012 Press Release, for background purposes, from The Derivative Project announcing this Petition for Rule Change to the SEC, with links to the SEC Petition for Rule-Making: "Request for rulemaking to reestablish the original congressional intent for a clear dichotomy between "Salesperson" and "Investment Adviser" under the Investment Advisers Act of 1940".
The Derivative Project's Petition for Rule Making is available at the Securities and Exchange Commission's website: http://www.sec.gov/rules/petitions.shtml
Press Release: http://www.prnewswire.com/news-releases/third-dodd-frank-fiduciary-standard-proposal-allows-private-right-of-action-147338015.html
Thank you in advance for your consideration of these most critical issues to every retirement investor today. In sum, until there are avenues to retirement investors to have breaches of the Investment Advisers Act enforced in their IRA or SEP-IRA, the discussion of a fiduciary standard for "brokers" is meaningless. Currently SEC Registered Investment Advisers are not sanctionned for fiduciary breaches under the Investment Advisers Act of 1940, except in the most extreme case of significant fraud and ponzi schemes. This is not sufficient for protecting American's life savings.
With over $4.7 trillion dollars of American's retirement savings in IRA's, we strongly encourage the Dodd Frank Investor Advisory Committee to launch a complete investigation into the issues presented in this Petition for Rule-Making, #4-648 and provide written answers to the American public on avenues for IRA/SEP IRA investors to seek redress by SEC registered investment advisers who have breached their fiduciary duty and how under the Investment Advisers Act of 1940 brokers and dually-registered RIA's can be considered fiduciaries.
In addition to the Petition, we propose for consideration to the SEC that the most immediate and efficient solution to protect retirement investors is to prohibit the "assets under management" business model for financial intermediaries to retirement accounts. The SEC should limit this business model to SEC registered investment companies, due to the rampant fraud and abuse by financial intermediaries of American's retirement savings, which is more in keeping with the intent of the Investment Advisers Act of 1940.
Thank you again for the ability to submit these comments for review.
The Derivative Project
Not On My Nickel