August 23, 2004
I strongly urge you to withdraw the rule exempting broker-dealers from the Investment Advisers Act of 1940 when offering fee-based brokerage programs. 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. I do not believe that the public appreciates the nuances of the Rule or understands that a brokerage account means the registered representative - unlike a registerd investment adviser - has no blanket fiduciary duty to place the clients interests first or an affirmative obligation to disclose all material conflicts of interest.