October 10, 2014
by Michelle Perry Higgins
Investors would benefit if Congress passed legislation mandating that all financial advisers/brokers be considered fiduciaries to their clients in all situations. This would do away with the dichotomy that now exists between advisers subject to the fiduciary standard and brokers subject to the less demanding suitability standard.
The argument against the institution of a universal fiduciary standard is that it will reduce advice to the “middle market.” I do not believe this to be a strong argument but it is backed by considerable political pressure that is stalling progress on this issue.