Writing about the Department of Labor’s proposed fiduciary standard in NAPA Net the Magazine, Don Trone urges advisors to better define a professional standard of care themselves — before the government does it for them.
Calling the DOL's proposed rule a “disaster,” Trone says it was born out of the Obama administration’s general distrust of what financial advisors do. He adds that, “the president has the opinion that some of you are ‘selling snake oil.’” He says the rule, while purporting to create a standard definition of a fiduciary, fails to answer exactly what requirements an advisor must meet now that they don’t already.
Trone urges advisors to be proactive and make positive changes to the industry to avoid further government intervention. He promotes an idea that the industry’s leaders should get together — a “congress of industry leaders” — and create a higher standard for a fiduciary, one that accurately reflects the years of training and experience needed to do the job at a high level.
The DOL, Trone writes, has ignored three decades of positive change in the way that fiduciaries and financial advisors as a whole view their role in retirement plans. In order to change the stereotypes about snake oil salesmen, Trone says, the onus is on advisors themselves to prove to government leaders that the industry is full of honest, capable professionals, and that increased regulation will only set these efforts back.
In addition to Trone’s regular “Inside the Stewardship Movement” column, the Summer issue of NAPA Net the Magazine highlights what the new generation of plan advisors are thinking — including the 2015 NAPA “Young Guns” list — along with a recap of this year’s NAPA 401(k) Summit in San Diego, and the cover story, which examines five key factors that advisors should look at when determining whether longevity-planning options are right for their clients. The Summer issue also features regular contributors Nevin Adams, Steff Chalk, David Levine, Warren Cormier, Jania Stout, Fred Barstein, Brian Graff, Jerry Bramlett and NAPA President Joe DeNoyior.
To view Trone’s column, click here and select “Meaning and Purpose.” And to view a pdf of the full 48-page issue, click here.
