August 29, 2010
To Whom It May Concern:
I understand the SEC is taking comments from the public regarding a new rule differentiating a broker from an investment advisor. As I professional in the financial services since 1985 it is my hope that my opinion is welcomed too.
I began my career as a Registered Representative and I have always operated from the tenet: "Do what is best for my client and my own needs will follow." It has served me well throughout my career; even when what I was recommending didn't compensate me. How could I in good conscious do otherwise. Having said this, I believe the SEC is addressing this issue from the wrong perspective; viz, from whether a title is clear or unclear rather than enforcing ethical business practices. Shouldn't the Commission be protecting the investor? If the BrokerDealer is so honorable in their investment offerings shouldn't they be willing to state their biases up front, in bold lettering before the investor invests any money? Let the BrokerDealer place this statement in their Code of Ethics as their number 1 code: "Some of our recommendations are not always in our investors best interest as we may receive a higher commission for the one we may recommend verses one that we don't." Let the B/D put their character and reputation right out front for all to witness. They don't want to, favoring instead to behave in a cowardly and dishonest manner by hiding their true intentions. Because this is all about how the B/D can steal an investor's money without providing all of the material information (1933 Securities violation) for the investor to make an informed investment decision. Stated another way: Why should there be a distinction between a Broker and an Investment Advisor, if trust, honesty and ethics are the foundations to our profession.
Regarding the Commission making this an issue worthy of public comment I must state I find this process to be shameful on its part. Why? Because it seems it has lost its common sense as to how an investor should always be treated. An investor does not deserve to lose their money simply because another person is in business and believes they deserve to earn money no matter what the cost to the investor. Perhaps there is a sucker born every minute but don't you think Bernie Madoff, Lloyd Blankfein, Mike Milken, Charles Keating and all the others that have absconded with ill gotten gains, incarcerated or not, have done enough damage to tarnish our profession? How about enforcing no fraud, no misrepresentation and misleading information and that a Broker Dealer make money the honest way: they earn it.
Evan F. Cole, RFC
Registered Financial Consultant
Investment Advisor Representative,
Gateway Financial Advisors, Inc.