• Neal Shikes

Fiduciary Avoidance Through Mixed Messages


The public at large has been inundated with marketing messages that herald individualized advice that is highly personalized and based on the client’s interest. However, when this message is substantiated in a mutual agreement it is completely disclaimed in the form of a footnote so that it doesn’t serve as the primary basis for investment decisions.

Other times advisers clearly receive compensation for recommending specific products though that guidance is considered “general education.” Confused by mixed messages and the regulatory structures that govern retirement assets?

Internal Revenue Code provisions state that any person paid to provide advice on the investment of IRA assets is a Fiduciary. The rule-making authority is the Department of Labor and the enforcement authority is the IRS.

ERISA pertains to Retirement Plans and states that any person paid directly or indirectly to provide plan officials or participants with advice on the investment plan assets is a fiduciary. Both the rule-making and enforcement authority is the Department of Labor.

Are these messages mixed?

#FiduciaryAwareness

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