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Extracting Actionable Takeaways From The SEC’s Staff Bulletin Regarding An RIA’s Standard Of Care

Nerd's Eye View

There is a general understanding that investment advisers have a fiduciary relationship with their clients – in other words, that they are required to act in the client's best interests. These 3 components in practice make up a core part of the adviser's fiduciary duty to their clients.

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When Are Advisors (Financially) Liable For Negligent Investment Advice? (And Who Pays For It)

Nerd's Eye View

For example, if an advisor recommends an investment that prioritizes the commission they would receive rather than any benefit the client would derive from it, they could incur fines and sanctions for violating their fiduciary duty as an advisor.

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Seeking Best Execution: Understanding The SEC’s Expectations For Advisors To Deliver Best Outcomes For Clients

Nerd's Eye View

While this requirement might sound relatively straightforward, the lack of a single definition for what this duty actually requires can make it challenging for advisers seeking to understand precisely what it means to comply with this responsibility. Read More.

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Weekend Reading For Financial Planners (September 28–September 29)

Nerd's Eye View

Also in industry news this week: As brokerage firms have faced a wave of lawsuits regarding the low interest rates paid on cash sweep accounts, some legal experts believe that RIAs could also be targeted for legal action if they allow clients' uninvested cash to sit in a cash sweep account rather than investing it or moving it to a higher-yielding (..)

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Fiduciary Duty – Theory versus Reality

Advisor Perspectives

They exist in all fee models, whether they be commissions, assets under management, fixed fee, or hourly. Conflicts are everywhere in financial planning. Any time money changes hands there are conflicts of interests.

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Fiduciary Papers #7: What Steps are Required to Properly Manage a Conflict of Interest Held by An Investment Adviser?

Ron A. Rhodes

While the SEC has provided an interpretative release [SEC Release IA-5248, Commission Interpretation Regarding Standard of Conduct for Investment Advisers (July 12, 2019)] regarding the fiduciary duties of investment advisers,…

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Fiduciary Papers #14: It’s Time to End Commissions and Revenue Sharing

Ron A. Rhodes

It is possible that all commission-based compensation involving the sale of investment products, life insurance products, and annuities could be eliminated. And it would be right and just to do…