August 17, 2010
The basic question comes down to clarifying to the client where the advisor stands with respect to first duty: to the best interest of the client, or the best interest of the advisor (or the advisor's employer). If someone maintains that other considerations than the best interest of the client should be considered first, then that someone does not propose to act as a fiduciary (which meaning has been fairly clear over time.) If that someone does not propose to act as a fiduciary, then they should stand by that decision and disclose that decision. They should not deceive the client through vague titles or verbiage that the client's best interest is paramount, but should make it clear that such best interest is only one consideration (not, for example, "the client's best interest is paramount when it is considered that only proprietary products are available at this store".)
I don't think that all providers of financial products should be forced to follow a fiduciary standard. I do think that they should all be required make it clear whether they follow a "fiduciary" or a "suitabilty" standard.