The Committee for the Fiduciary Standard is renewing its push for financial
advisors to sign its fiduciary oath with the recent pressure from insurance
companies that are lobbying to kill the Labor Department's fiduciary
Its oath, a
one-page document (PDF) lists five fiduciary principles that the Committee believes financial
advisers need to follow in order to ensure that their clients’ interests
are put ahead of their own. The oath has been around for a few years now,
but the 5th Circuit Court of Appeals’ striking down of the Labor
Department's rule, in addition to other influences, increased the
Committee’s urgency in pushing it into circulation.
"With the 5th Circuit ruling, it is just so important to have this
oath out there because it states fiduciary principles," said Patti
Houlihan, president of Houlihan Financial Resource Group and Chair of
the Committee for the Fiduciary Standard. "The oath is the answer,
given that the DOL rule is gone."
Other supporters of the oath believe that even brokers who keep their client’s
best interests in mind may be restricted from following the five principles
because of their firms’ compensation policies and product platforms.
"We think this helps sort out who is willing and able to act as your
fiduciary from someone who may want to but is hampered by the way their
firm is set up," said Kathleen McBride, founder of consulting firm
FiduciaryPath and member of the Committee for the Fiduciary Standard.
"There's nothing in that oath that anyone providing advice shouldn't
be doing anyway."
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