Subject: File No. 4-606
From: James M Danford, III
Affiliation: Financial Advisor, Waddell Reed, Inc.

August 18, 2010

I am writing to express my support of a fiduciary standard for all those who provide investment advice to consumers. I believe that brokers or dealers who provide personalized investment advice to retail clients should adhere to the same fiduciary standard of care currently required of investment advisers under the Investment Advisers Act of 1940. It is my belief that having a consumer-friendly, fiduciary standard is good for the American public and good for my business.

I believe that the current dual standard for investment advice is confusing and harmful to consumers. Consumers should not receive a different standard of care for the same type of advice just because it is delivered by a broker-dealer or insurance agent rather than an investment adviser or CERTIFIED FINANCIAL PLANNER professional. Investors deserve clear standards that place their interests first and ensure they are informed of conflicts of interest. This what the consumer expects anyway and they are surprised when they learn of dual standards within our industry.

I see a parallel between this issue and an issue we have with our police force in Columbia, located within Richland County, SC. City police patrol the City of Columbia. Richland County police patrol Richland County. Each police force only reports to concerns within their jurisdication. On the surface, this sounds fair. However, our city has pockets of unincorporated areas. Areas that would seem to be patrolled by city police, but are technically not within the city and, therefore, not within their jurisdiction.

I live downtown Columbia just blocks away from the Governor's Mansion. Across the street from me are a couple blocks that are not incorporated into the city. On garbage day, two dump trucks drive down my street. One for the City of Columbia and one for Richland County. Two dump trucks doing the job that could be done by one. When I call the police about something, I always have an issue of jurisdiction. As a resident of the City of Columbia, I called the city police one time when I had an aggressive panhandler ring my doorbell at 10pm. The city police said my home was not in their juridiction. Richland County police responded only to tell me my home was not in their jurisdiction. Eventually, city police responded and addressed the issue. However, I did not care who responded. I did not care if it was handled by city police or by county police. I do did not care what badge the cop was wearing or what patrol car he was driving. All I know is that I called the police and expected the issue to be handled.

I think the scenario about dual jurisdictions above helps to illustrate some points about the dual standard for investment advice. Just like having two dump trucks come down my street is a waste of resources, so too is the confusing nature of enforcing dual standards for investment advice. Just as I have an expectation for police to respond when they are called, so too does the consumer have the expectation for everyone giving investment advice to look out for their best interests. Just as I expect the same assistance from a city cop or a county cop, so too does the consumer expect the same standard from brokers, dealers, and investment advisors. The consumer does not care what badge is being worn by the person giving them advice because they expect us to be held to the same standard. Also, just as the police have questions about jurisdiction, so too do you and other regulators have to decide which standard is being applied for a particular complaint.

Currently, the city police force and the county police force are in negotiations to consolidate so that there will no longer be issues of jurisdiction, city and county resources will not be wasted, and so that the expectations of city/county residents will be met when they call police regardless of which police force responds. When a consumer calls upon you, will you be forced to determine which standard is applicable, will you be wasting time and resources, and will you be unable to meet the expectations of the investing public? My hope is that you can answer no to these questions and I believe implementing a fiduciary standard for all those who provide investment advice to consumers will help you do so.