July 21, 2009
The custody proposal currently under consideration will significantly increase the cost of business to smaller advisers. In an attempt to control a limited number of dishonest advisers the additional requirement will impair the efforts of prudent fiduciaries who have a responsibility (ethically, morally and legally) to work in the best interests of clients.
We are currently required to document how fees are calculated and to advise clients of our fees before they are deducted. Clients have an option to pay by check - with no deduction through custodial accounts and sign acknowledgement of their desire to have fees deducted.
This proposal is burdensome and merely serves to add costs to investors and fill the pockets of one group - the "independent" accountants.