August 12, 2010
To whom it may concern,
I respectfully request that you do not move forward in establishing the "fiduciary duties" rules impacting Registered Respresentatives.
In my opinion, the people whom the rules are meant to protect -- the average joe middle class -- will actually hurt their opportunities to receive the advice and services provided by registered financial professionals. The rules would force the securites industry to move significantly more to a fee based system. Currently, most fee based structures require a significant minimum investment. Additionally, "fee for service" planners typically focus on higher net worth individuals that can afford to pay the fees associated with the planning service they provide. The average middle class investor will be stuck with either a "do it yourself" strategy or invest money into planning/service fees that should be going into their retirement or savings accounts. From an advisor standpoint, this rule change will force many advisors out of the business, or force them to adjust their marketing structure abandoning the middle and lower income consumers, just to stay profitable. The impact of this could be devestating considering that the average age of an advisor today is 55 yrs and there are fewer advisors in the buisness today than 10 years ago.
Currently, the securities industry has significant provisions to protect the investing consumer with strong and appropriate safeguards. The additional risks to consumers of lawsuits will assuredly increase costs to consumers by investment companies and advisors.
If the goal of this rule is to provide better, unbiased advice and service to the consumer, this is the absolute incorrect path with which to do it. There are a number of opportunities that the SEC and FINRA, working with the securities industry, could enact to benefit the consumer and do so without causing the havoc that the "fiduciary duty" rules would assuredly cause.