Monday, February 21, 2011

Consumer Reports Comments on Financial Planning Industry Studies

As most financial advisers know, two recent reports comment on the state of the industry related to consumer awareness of safeguards and standards. The Securities and Exchange Commission study recommends that it be a requirement for anyone offering financial advice to be held to the same fiduciary standard that financial planners and advisers are held to. This would include broker-dealers, as has not been the case in the past.

The reason for this is that both this study and a report by the Government Accountability office show that most consumers have no idea about the different standards and regulations that people dispensing financial advice must adhere to.

FINRA, the financial industry’s self regulating organization, issued a statement noting that “investors deserve the same level of protection regardless of whether they are dealing with a broker or investment advisor”.

For a full article regarding these two reports, you can visit the Consumer Reports website.