BUZ LIVINGSTON: Comedy, fiduciary standards and financial terrorism

Published: Thursday, September 12, 2013 at 04:35 PM.

Thanks to the magic of modern technology, inquiring minds discovered a financial services industry lobbyist drafted said epistle. Then said industry lobbied the Securities and Exchange Commission citing in part the letter signed by the congresswomen and men.  Thank you, Maxine Waters for this bit of levity. LOL, the fiduciary standard debate allows me to scoop my First Facebook Friend Ever, Ron Hart, on a liberal licentiousness story.

The argument against a fiduciary standard further disintegrates when you see other countries incorporating it for investors.

Both Britain and Australia have implemented a fiduciary standard. We speak the same language (similar anyway) and all three of our court systems follow English Common Law. The London Stock Exchange traces its lineage to the Royal Exchange founded by Queen Elizabeth I in 1571.

They’ve been dancing the capitalism jig for centuries, long before we were a nation. It’s not like they are singing Karl Marx hallelujahs. A fiduciary standard is merely an evolutionary offshoot of the crescent of prosperity springing from Genoa, Italy, to Great Britain and its former colonies.

A fiduciary standard means nothing if practitioners ignore it. Asset managers, posing as fiduciaries, sometimes recommend taking Social Security before full retirement age, resulting in asset management fees for them and eliminating the seven percent annual increase in Social Security benefits for their clients.

Fee-only fiduciary planners routinely charge asset management fees on qualified plans — 401(k)s for instance, they only manage from afar. Charging full fare on limited options inside a qualified plan seems a fiduciary reach.  Conversely, I’ve worked with non-fiduciary investment professionals who practice as fiduciaries because it’s the right thing to do. 

With a fiduciary standard nothing changes for anyone who walks the walk.

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