New trade group wants 'authentic fiduciary standard'

Aim is to explain why the standard is key for investors

Jun 29, 2009 @ 3:09 pm

By Sara Hansard

A group of 11 fee-only advisers and consultants today started a media campaign to push for adoption of a strong fiduciary standard in connection with financial services regulatory reform.

Calling themselves the Committee for the Fiduciary Standard, the group issued a release calling on Congress “to uphold the authentic fiduciary standard as it drafts new legislation extending fiduciary duties to more advisers and brokers.”

The Obama administration called for requiring broker advisers to come under fiduciary standards as part of its regulatory reform plan, which was issued June 17.

“Our primary task is to reach out to the broader consumer and financial media and talk about why the authentic fiduciary standard is critical to investors,” said Knut Rostad, regulatory and compliance officer for Rembert Pendleton Jackson, a registered investment advisory firm in Falls Church, Va., that manages $475 million.

Investment advisers have expressed concern that fiduciary standards could be weakened to accommodate brokers who act as advisers.

Five principles outlined in the release were putting client’s best interests first, using good professional judgment, providing conspicuous disclosure of all important facts, avoiding conflicts of interest if possible and fairly managing and disclosing any unavoidable conflicts.

The group, which was formed by Mr. Rostad over the last two weeks, is looking for more members, he said.

In addition to Mr. Rostad, members of the committee are:

Harold Evensky, founder and president of Evensky & Katz LLC of Coral Gables, Fla.; Blaine Aikin, president and chief executive of Fiduciary360 LP in Sewickley, Pa.; Clark Blackman president and chief executive of Alpha Wealth Strategies LLC of Kingwood, Texas; Sheryl Garrett, founder and president of Garrett Planning Network Inc. of Shawnee Mission, Kan.

In addition,Roger Gibson, chief investment officer of Gibson Capital LLC of Wexford, Pa.; Matthew Hutcheson, of Independent Pension Fiduciary of Tigard, Ore. [no title available]; Gregory Kasten, chief executive of United Trust Co. in Lexington, Ky.; Fred Reish, managing director of Reish Luftman Reicher & Cohen of Los Angeles; Ronald Roge, chairman of R.W. Roge & Company in Bohemia, N.Y., and Kate McBride, editor-in-chief of Wealth Manager Magazine of Hoboken, N.J.

Only a few of these members are National Association of Personal Financial Advisors members, said Mr. Rostad. "There is not a single group that is exclusively focused on reaching out to the media and talking to investors about why passing the authentic fiduciary standard matters."


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