It's no surprise that
Although specifics of the proposal were left out during his Monday afternoon remarks at the AARP, the president slammed industry practices that may harm investors.
"There are a lot of very fine financial advisors out there, but there [are] also financial advisors who receive back-door payments or hidden fees for steering people into bad retirement investments that have high fees and low returns," Obama said in his push for a uniform fiduciary rule.
Blair H. duQuesnay, chief investment officer at RIA ThirtyNorth Investments in New Orleans, summed it up bluntly on Twitter: "
Here's what other advisors and industry experts had to say on Twitter and in comments online.
Bonnie Sewell, the CEO of fee-only wealth management firm American Capital Planning in Leesburg, Va., tweeted about the potential positive outcomes:
@cnbc fiduciary rule=transparency on costs-if you've got something worth selling, ie annuity, show me what the cost is
Bonnie Sewell (@americancapplan) February 23, 2015
NAPFA advisor David O'Brien, of RIA O'Brien Financial Planning in Midlothian, Va., tweeted that it was "eye opening to see who opposes it," calling the proposed rules "fair and simple."
Meanwhile, James Osborne, a CFP and founder of fee-only planning firm Bason Asset Management in Lakewood, Colo., pointed to conflicts of interest even fiduciary advisors might face:
Ultimately, many financial professionals have an incentive to recommend expensive actively managed funds, whether fiduciary or not...
James Osborne, CFP® (@BasonAsset) February 24, 2015
...because to justify fees, many fiduciaries must present themselves as "investment experts" who can add value through active mgmt
James Osborne, CFP® (@BasonAsset) February 24, 2015
Josh Brown, CEO of New York advisory firm Ritholtz Wealth Management, as well as a prolific blogger and tweeter, quipped about financial lobbyists' criticism of the proposal:
The financial lobby says a Fiduciary standard makes it too costly to service retirement accounts. Your services are no longer needed.
Downtown Josh Brown (@ReformedBroker) February 23, 2015
Also on Twitter Brian Hamburger, attorney and founder of the Englewood, Nj.-based regulatory compliance consulting firm MarketCounsel:criticized the Obama Administration's approach:
This is a classic economic problem where the buyer of services, employer, is different from its beneficiaries, the would-be retirees.
Brian Hamburger (@HDelux) February 23, 2015
This is not about bad advice. The problem here is that consumers have been sold brokers' risk mitigation tools masqueraded as advice.
Brian Hamburger (@HDelux) February 23, 2015
I think the White House is confused. The rules were written far more than 40 years ago. They haven't been enforced for about that long.
Brian Hamburger (@HDelux) February 23, 2015
In response to a recent article on
Today, I find myself agreeing with President Obama in the need for responsible definition of 'advisor' in the financial industry. For too many years the general public has been lied to by large investment houses and broker/dealers. If you are a broker you should be executing trades for clients not advising them. If you are an investment banker leave the individuals alone and work on the IPO's and M&A work that you intended when organized.
Another commenter posting under the name Matt B. agreed, noting that "free disclosure isnt a bad thing." He wrote:
The group they really need to crack down on is the Equity Indexed Annuity industry," Brown suggested. "That's where the real problem is. These guys aren't even required to have a securities license, and yet they discuss the market and make investment comparisons all the time. Talk about the blind leading the blind.
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