As part of last summer's financial reform legislation, the SEC was asked to review whether stockbrokers should be held to the same fiduciary standard that wealth managers such as myself adhere to. On Friday , the SEC announced its recommendation that brokers and other financial advisors use a "uniform fiduciary standard of conduct" in all their relations with their clients.
This may sound like a bit of regulatory "inside baseball," but it could actually have a significant impact on the individual investor. Stockbrokers have traditionally not been held to this standard, but rather had license to push onto their clientele whatever securities they deemed "suitable." According to the SEC study, many investors are unaware that the two types of professionals operate under different standards.
The next step is for SEC commissioners to write new regulations, based on this study. This could be a critical step toward reforming the financial landscape for many American investors. Watch the Echelon Wealth Strategies Web site for a more detailed explanation of this important issue, and how it might affect your own financial goals.
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