August 3, 2010
I have not been a financial advisor for more than a few years, but I do recognize the importance of this argument and the need for a sound decision and implementation of rule thereafter.
As an independent advisor that is both B/D and IA I serve my clients in a number of ways. On a macro level, I strongly believe that my position as an independent advisor is a fundamentally better way to align my interests with my clients. Had I chosen to work for a captive company I would have had to sell said company's product perhaps it's a good product but not the best for my client. I bring this point up simply to illustrate that there are a number of ways one can impose fiduciary OR suitability standards. Why not outlaw all captive companies... are they breaking fiduciary standards by selling a product to a client when there might be a better one for that individual right across the street?
I believe that imposing a fiduciary standard on B/D, while sounding appropriate and good, is really just going to add more red tape, less flexibility, and ultimately more costs to the client, without strengthening an already robust client centered responsibility standard, i.e. suitability.