Under the Dodd-Frank Bill, Restoring American Financial Stability Act of 2010, there is a
movement to reset the standards advisors must follow when dealing with their
customers. This bill was made necessary by the abuses of a few brokers in our
industry. I believe all professionals must find ways to restore the trust of
the American public. The return of the fiduciary standard is a good step toward
this goal.

The investor protection portion of the bill continues to elicit debate. Regulators now have the authority to require all financial advisors to act in their clients’ best interest by discussing fees, disciplinary actions, conflicts of interest and commissions paid on transactions. In other words, full disclosure must be the standard.

According to Matthew D. Hutcheson, MS, CPC, AIFA®, CRC®,
an independent professional fiduciary and a nationally recognized authority on
qualified plans and fiduciary responsibility, the fiduciary standard of care
rests on one’s ability to:

• Put the plan participants’ best interest
  first
• Act with the prudence, skill, care, diligence
  and good judgment of a professional
• Not mislead sponsors or participants and
  disclose all material facts
• Avoid conflicts of interest and fully
  disclose and fairly manage all matters

Trust, once lost, is very difficult to restore. Since
fiduciary is synonymous with trust, the fiduciary standard must be high and
strictly adhered to.