“Wow, that happened quick.”
Fi360 executive chairman expressed surprise at how quickly the room quieted at the start of his opening remarks at the start of the fiduciary and technology firm’s annual conference in Nashville on Wednesday afternoon.
But attendees, numbering over 800, appeared to be ready for business. Celebrating it’s 15th such conference, it’s largest, while also noting Fi360’s 20 anniversary, as it began as an organization in 1999.
His topic focused on a regulatory recap of where the industry is currently with the implementation of a fiduciary standard.
Noting the strategy (or luck) of timing the conference to seemingly coincide with major announcements from Washington, he said he believes the SEC will “come back in next month or two.”
“Last year, the SEC announced their try at standard,” Aikin said. “It was the DOL the year before. We were hoping for similar timing this year, and we’ll be close.”
Referencing the famous spaghetti western, he said SEC BI is currently a case of the “Good, the Bad and the Ugly.”
“The good is that it elevates the fiduciary obligations of advisors. The bad is that we still don’t have a full fiduciary standard. And the ugly is that the client summary that’s proposed shows that it does a poor job of distinguishing between fiduciary and non-fiduciary advice.”
At this point it probably won’t matter, he argued, as the SEC probably won’t make major changes or delay further “because it would necessitate another public comment period and would have to adhere to the Federal Records Act.”
Three-legged regulatory stool
If the DOL is the first leg of the current regulatory stool, and the second leg is the SEC, the third is the state initiatives.
“It’s good that the states are moving on their own, as it’s pushed the feds to act, but model legislation is needed to avoid a patchwork and ensure consistency.”
So, where does it leave advisors currently?
“The chaos of the current regulatory environment leads to opportunity for differentiation. It’s muddled, which can be frustrating but is also an opportunity to promote professionalism. We’re truly serving the best interest of the clients and want advisors to be recognized for it.”