Subject: File No. 4-606
From: Wesley A Engeseth
Affiliation: National Association of Insurance and Financial Advisors

August 23, 2010

I am opposed to the application of the Fiduciary Standard of Care to all representatives of broker-dealers.

I disagree that the fiduciary standard has protected consumers better. Basically, the fiduciary standard looks back and enforces breaches retroactively through SEC enforcement or private lawsuits. The suitability standard looks forward and tries to prevent harm to consumers through ongoing and frequent FINRA and broker-dealer audits and compliance processes.

While NAIFA members believe they are already acting in the "best interest" of their clients, the Act does not define what the rules are for compliance with a legal "best interest" standard - thus subjecting registered representatives to the potential of never ending lawsuits. For example, is "best" the cheapest recommended product? The "best" premium relative to the benefit of the product? The product with the "best" historic underwriting and service standards? Is it the one from the carrier with the "best" rating? The fiduciary standard in essence adds a vague legal liability standard that looks back (sometimes after many years) and is enforced after the fact by the SEC or trial lawyers who have perfect vision in hindsight.

I believe that a fee based model of business practice will ultimately shut out lower and middle class individuals and families who will not or can not pay the fees.

I also believe that advisors will begin to drop their licenses that require burdensome regulation and compliance and instead take up different business models or careers.