August 26, 2004
Comment on File No. S7-25-99
SEC Broker-Dealer Rule Exemption
I urge the SEC to WITHDRAW this rule proposal.
I believe this rule is harmful to consumers by creating two different standards of conduct for persons offering financial planning services: a higher fiduciary standard for registered investment advisers and a lower one under NASD suitability rules for brokers.
This rule effectively exempts brokers from being required to disclose conflicts of interest in connection with financial planning services offered.
Allowing brokers to posture themselves as if they represent a fiduciary relationship to a client, when in fact they do not, has lead to numerous scandals in our profession and undermines public confidence in financial advisors.
Those of us who accept fiduciary responsiblity and act as agents of our clients ought to be clearly differentiated from salespeople who are beholden to a wirehouse or other financial institution.