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The story of FINRA's implacable drift from its founding ideals to a pallid 'no-lying baseline'

In Part 2 of a four-part series, our one-man think tank narrates the back story of today's fiduciary standoff, getting to the root of the 'insidious conflicts' that made the terms 'broker' and 'trustee' oxymoronic

Author Guest Columnist Ron Rhoades July 9, 2013 at 4:04 AM
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Ron Rhoades: Brokers continue to operate with a free hand -- unburdened by the duty of nearly every other person in the U.S.

RIA Compliance

Stephen Winks

Stephen Winks

July 9, 2013 — 8:45 PM

For Congressmen(women) who require the SEC and DOL to go slow on Dodd-Frank implementation, for industry apologist insular to the best interests of the investing public and for Regulators who are genuinely concerned about the loss of trust and confidence of the investing public in our leading financial services institutions—Ron Rhoades documentation of mission creep from the founding principles of broker regulation is a must read.

Ron raises the question of public trust as envisioned by Senator Maloney in establishing the founding principles of industry regulation. When left to the industry, regulation quickly became insular to the best interests of the investing public which has lead to the loss of trust and confidence of the consumer and increasingly brokers whose reputations are being placed at cross purposes to their client’s best interests by industry practices.

The seminal distinction is how under the auspices of FINRA and the SIFMA could the industry make it a violation of internal compliance protocol for brokers to acknowledge they render advice and have ongoing fiduciary duties to act in the consumer’s best interest. Clearly, the consumer’s best interest was and is not a consideration.

Ron Rhoades makes a beautifully well documented case for the regulatory authority granted to FINRA has lost its initial purpose, and has in fact become counter to the best interests of the investing public.

This is a must read and should be widely dissemimated by all who care about public trust and professional standing to include Congressional policy makers, industry executives and regulators who fein ignorance.


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