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NAPFA's John responds to critic questioning her group's stance on compensation in light of new DOL rules

The national chair says the first objective is not to scare small investors away

Author Susan John April 3, 2012 at 2:55 AM
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Susan John: If no one is willing to advise the consumer of the $25K IRA, that’s a problem.

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Women of Wealth Management

norman berk

norman berk

April 3, 2012 — 3:49 PM

I agree with the concept of one standard for all, the highest standard possible. However, NAPFA would do a service to the professional community by refraining their repititive chest thumping of how virtuous they are and how they are the true fee-only and fiduciary driven organization.

What is not stated in this article is how many of us choose to not join this holier than thou crusade. After all, this is the group that attempted to trademark the term fee only and to police the profession by legally preventing anyone from using the term unless NAPFA granted

Enough already.

Please spend your energy on one fiduciary standard for all, that would benefit the profession and the public.

Stephen Winks

Stephen Winks

April 4, 2012 — 3:03 PM


There already is a “ fiducuary standard for all” based on objective, non-negotiable fiduciary criteria of statute, case law and regulatory opinion letters. Best practices determines how good we are and is the basis upon which the industry competes.

There is nothing controversial, nothing to debate, just the responsibility to act in the client’s best interest.

The SEC has established it is the responsibility of the industry to support advisors so they can safely act in the consumers best interest. This is not a question of the broker not wanting to act in their client’s best interest—it is a question of the industry providing the necessary supprting resources that makes advice safe, scalable, easy to execute and manage.

There are no accomodations or excuses for those that choose not to support their brokers to act in the client’s best interest as required by force of statute under Dodd-Frank. Pretty simple. The industry is missing in action. This is why Congress had to pass Dodd-Frank, and even then the industry still is not supporting fiduciary standing.

NAPFA is to be commended in standing on principle, but even most of their membership is supported by broker/dealers or custodians which either do not allow or support fiduciary standing.

What does it take to give the brokerage industry a kick in the pants so it is even possible for the broker to act in an expert fiduciary capacity. No one, even the industry itself, disagrees with serving the client’s best interest. It’s time to remove the impediments, so brokers can align their interests with the best interest of the consumer.

Actions speak louder than words. Despite the industry’s public position, it is still working against its brokers being required to act in the consumer’s best interest based on objective expert fiduciary criteria.


Mentioned in this article:

National Association of Personal Finance Advisors
Top Executive: Geof Brown, CAE

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