August 26, 2010
To whom it may concern,
I am writing to voice my opinion regarding the SEC study regarding the fiduciary standard for all registered representatives. I am very concerned about the impact such a broadbased standard would have on my practice and how I interface with my clients.
I have been in the busines for 11 years. I have never had a complaint levied against me and I pride myself on doing the right thing for the client always. I have found the suitability standard to be sufficient in regulating my business practices. In the last 5 years, due to increased regulation already, I have found the complexity of compliance to be a real strain. Amongst all levels (Industry, Company, Office) there is no continuity with what are the current regulations. No one seems to know. This will NOT IMPROVE with a fiduciary standard. At best, this standard is vague at worst, it is extremely limiting and causes the potential for increase costs to investors and cutting down on the number of clients I am able to service.
I have approximately 400 clients who depend on me for financial advice and to date, I've been able to provide it. If the regulation becomes too much of an issue, I will cut my practice in half to limit my future liability which won't serve the interests of my clients. I hold the Series 7, 6 and 63 license as well as my life and health. I am required to have 10 hours of CE EVERY year already to make sure I am compliant and continuing my practice in the best possible way.
Why is the answer more regulation? I don't want to have a regulator who knows NOTHING about my clients and has never met them telling me that I did the wrong thing for my client because of a fiduciary standard. It is misplaced and misguided.
Instead of creating whole new levels of bureaocracy and complexity, let's keep the same suitability standard that is currently in place and allow us advisors to operate in a known environment.
Finally, please explain to me how charging clients 1 to 1.5% EVERY SINGLE YEAR on top of operating expenses is doing the best thing for the client especially when the C-share 12B-1 fees are already cheaper.
Thanks,
John A. Klich