August 23, 2004
I strongly believe that you should WITHDRAW, not amend, the rule proposal exempting broker-dealers from the Investment Advisers Act of 1940 when offering fee-based brokerage programs. FPA believes the rule is harmful to consumers by creating two different standards of conduct for persons offering financial planning services: a higher fiduciary standard for registered investment advisers and a lower one under NASD suitability rules. The rule also exempts, in effect, brokers from being required to disclose conflicts of interest in connection with the offer of financial planning services.