August 2, 2010
Thank you for accepting comments on this important matter.
The suitability standard that governs broker-dealers and registered reps is a heavily enforced standard and is robust.
The compliance cost in terms of money and time are very high.these costs are felt ultimately by the client. By adding an additional layer of compliance will cost client even more.
I currently am series 6,63,and 7 licenced by FINRA and also hold a state licence in life,health and disability insurance. My B/D. annually requires me to test my understanding of current and basic issues due to my licences 7,6,snd 63. FINRA also tests my understanding approx. each 36 months. I will spend 3 1/2 hrs at an approved testing center in the coming days to meet continuing education for my securities licences.So my firm tests me and Finra Regulatory Element. The firm element will take form 4 to 5 hrs. Each security transaction has specific paperwork that I and my office assistant complete and is reviewed by my on site compliance officer as well as the B/D comliance team. All of this to assure suitablity
for my valued clients. This oversite is valuable but time and cost intensive. I believe this process is needed and is enough. Compliance will take a signifcant part of my day and is in part why I have increased my support staff at my expense.
Moving to a Fee-only won't result in better advice
or an unbiased form of advice. Proper and professonal training, testing, experiance, and competion along with current supervision(FINRA and B/D)do the job well.
My clients understand my compensation and my won't be able to afford a Fee-only model, and I may be forced out of the business.
I am concerned about the increased costs of errors and omissions coverage which is already signifcant to me.
I act in the interests of my clients. The current suitability standard is heavily enforced and I know by experiance works well.
Thank you for concidering my view point. Let's maintain the current system
Thomas R. Baird ChFC,CLU