August 25, 2010
Regarding Release No. 34-62577 IA-3058 File No. 4-606
Study Regarding Obligations of Brokers, Dealers, and Investment Advisers
Request for Comment
Agency: Securities and Exchange Commission
To: Elizabeth M. Murphy, Secretary
Securities and Exchange Commission
From: John M. Woleben, CLU, ChFC,
Series 7, Series 63, Series 65 Licenses
As a licensed insurance agent for over 30 years, a Chartered Life Underwriter, Chartered Financial Consultant, and Registered Representative and Registered Investment Adviser (RIA), I have been licensed and regulated by the Commonwealth of Virginia Bureau of Insurance, the National Association of Securities Dealers, now known as FINRA, and the Securities and Exchange Commission (SEC) for as long as I have held my respective licenses. I feel that the current level of regulation is more than enough regulation, and that the government, state or federal, and all of the agencies therein will never be able to prevent the likes of Michael Milken and Bernie Madoff to prey upon the public.
It is not necessary to impose a fiduciary standard on all securities business, since there is already such a standard on the Registered Investment Adviser. When I deal with clients as an RIA, I do so in a fiduciary capacity, and when I deal with clients as a Registered Representative, I do so in a client relationship, not a fiduciary capacity. The cost of doing business as a fiduciary in both capacities would increase greatly, and not really benefit the securities client sufficiently to justify the increased cost of doing business. I deal with all of my clients in the same manner that I would for myself or my family thereby negating the necessity of a fiduciary standard in my Registered Representative business. If one treats their clients as they themselves would like to be treated, there should be no problem in how the client is served.
Furthermore, I do not want to see taxes increase any more than the next person, and to impose a fiduciary standard on both RIA business and the business of a Registered Representative would have to increase the cost of government, which will be passed along to all taxpayers. We are already taxed and regulated enough. As previously stated all of the regulation in the world cannot prevent those with criminal intent from performing their illegal acts.
In conclusion, I hope that the study will determine that there is quite enough regulation of the securities business already and that raising taxes to increase regulation is not the answer to human deficiencies that the government might like to try to control, but will never be able to do so.