July 27, 2009
I would like to encourage the SEC to consider the general public's best interest, when authoring new rules that affect the financial advice-giving sector.
I disagree with the surprise audit/new definition of custody primarily because it will put financial advice farther out of reach of the general public, by making financial advice more expensive to deliver.
Rather than considering our fees-in-arrears as custody of assets and requiring surprise audits, I ask the SEC to focus on the time and money our firms spend educating the public. I believe that an educated, informed investor cannot be fooled. Furthermore, these proposed surprise audits will, by raising costs, force me and advisors like me to serve only the very wealthy.
Is the general public served by surprise audits, or by this definition of custody? Or are they harmed, by not being able to afford professional advice on investing for themselves, their futures, their families?
When a reasonable fee for services rendered is agreed to by BOTH the recipient and the provider, that's commerce. It's capitalism. When our services include education, wealth management, protection, and planning, we serve the public, profitably.
A better alternative -- one that would serve the public and satisfy the SEC's need for action in the face of the Madoff scandal -- would be to introduce a pro-bono requirement for financial advisors, much like attorneys have. To maintain our licenses, for example, we'd have to complete our existing CE, ethics, and anti-money laundering training ... and 3 hours of pro-bono/public service work in a financial capacity.
In 5 years, the general public would be more informed, harder to fool, and wow, a lot more prepared for retirement.
Education is the key that turns every lock.
Respectfully,
Julie C. Morgan, MBA
Englewood, Colorado 80112