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One-Man Think Tank: Four red flags in the SEC's fiduciary report

The standard may help right an economy overweighted by finance, but there's a strong chance Wall Street will block it

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Ron Rhoades: “Sh***y products” – such as the many poor asset-backed securities manufactured in the 2002 to 2008 time frame – would likely not have been manufactured in such great numbers had financial intermediaries been fiduciaries.

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November 18, 2022 at 2:56 AM



larry elford

larry elford

March 1, 2011 — 4:30 PM

As a former broker, turned whistleblower, I agree with Ron Rhoades comments. Time is long past for unscrupulous commission salespersons to fool the public into harming themselves for the sake of a sale.

Without positive change, each investment seller becomes a potential lawsuit and the things they hide from the customer form the evidence against the seller. Same for the phony regulator game. The conflicts, the corruption, the regulatory capture all form the basis of a legal action against those who fail to follow “best practices”.

www.breachoftrust.ca, a film journey to find ethics in brokerage
www.investoradvocates.ca, a professional forum/blog to shed light on worst/best practices
www.albertafraud.com, proposed legal action against those who harm the public

Canadian based but I believe the principles of wrongdoing apply across geographic lines.

Jan Sackley, CFE

Jan Sackley, CFE

March 2, 2011 — 9:05 PM

Ron, you are absolutely correct that scant attention has been paid to your fourth point about the hat-shifting roles of financial employees. It seems even more financial institutions today than just a few years ago are employing a model which mixes fiduciary and non-fiduciary activities by “teams” of employees or even by individuals who are permitted to serve the same customer in different capacities. While this has been going on for more than a decade, it seems to be increasing rather than decreasing in some of the behemoth firms, with smaller banks following suit, viewing it as a cost-effective way to be all things to a customer and make all products and services available. More thought needs to be given to the confusing impact this mixture has on the consumer’s understanding of what service to expect, particularly where the affiliated firms providing different services share common or similar names. Failure to meet customer expectations can often trigger litigation so it would behoove firms to realize that a clearer delineation between securities sales and fiduciary advisory services may increase customer satisfaction and decrease litigation risk..

Jan Sackley
Fiduciary Foresight, LLC
Twitter@FidFore

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