Fiduciary Links: Survey Paints Unflattering Portrait of Financial Services Leadership
Posted by fi360 Team on July 29, 2013
>>>>“No matter what commercial crisis we examine, there are, almost without exception, three factors that form a perfect storm: greed, weak leadership and fear.”
Those are the words used by law firm Labaton Sucharow LLP to summarize the findings of their second annual financial services industry survey. In his latest Fiduciary Corner column for InvestmentNews, Blaine Aikin takes a look at how investors are completely justified in questioning the trustworthiness of those in financial services.
Among the findings are that roughly a quarter of all advisors surveyed had firsthand knowledge of wrongdoing, feel incentivized to compromise their ethical standards or violate the law, would engage in insider trading if they felt they could get away with it, and feels that their own industry does not put clients’ interests first. Even more alarming was that these numbers were even higher for younger respondents, which doesn’t bode well for the leadership situation improving over time.
The survey is a stark reminder that the culture in financial services will need to fundamentally change before investors should be expected to follow suit and believe advisors are working in their best interests.
Now on to the best links of the week:
News and columns from the leading trade, consumer, and mainstream media:
- A disturbing portrait of the industry, by Blaine Aikin. [InvestmentNews]
- Three big risks for your older clients [InvestmentNews]
- Chairman White says investor protection a part of hedge fund advertising rule [InvestmentNews]
- Stark statistics, glimmers of hope at DC retirement summit [ThinkAdvisor]
- The generational divide: the next generation of investors is easily misunderstood [WealthManagement]
- The most important phrase you’ll ever use to close a meeting: ‘How do you feel about this?’ [WealthManagement]
From the organizations/associations/government/academia:
- Fred Reish lays out what the “Yale letters” mean for plan sponsors [Drinker Biddle]
- Some clarification on the timing of annual participant fee disclosure requirements, particularly the comparative chart requirement [DOL]
- Does appraising employee stock ownership plans constitute fiduciary duty? Should it? AICPA thinks not. [AICPA]
- Richard P. Rojeck elected 2014 Chair-Elect of CFP Board [CFP Board]
From the blogs:
- Exclusive interview with Tamar Frankel: DOL should return to ERISA’s original definition of fiduciary [FiduciaryNews]
- DOL proposed regulation sent to OMB [FredReish]
- The 8 pillars of an RIA-created professional organization and how it would put the SRO issue to bed forever, Why the industry needs to create its own group to serve investors, an article by Ron Rhoades. [RIABiz]
Articles your clients are reading (or should be):
- Six options for boosting your yield in retirement. [USNews]
- Five alternative ways to retire early, especially if you work for it in your 20s and 30s. [USNews]
- Ethical lapses on Wall Street generates interesting data, according to the second annual survey from the law firm Labaton Sucharow. [USNews]
Have a link we missed? Leave them in the comments section or email us at blog@fi360.com. For more of the best links during the week, make sure you follow us on Twitter.
