The FINRA Trojan Horse

October 9, 2009

The FINRA Trojan Horse
Registered investment advisors might soon have a new regulator. FINRA looks interested. This is not good news.

By Bill Singer, Attorney and publisher of and

BILL SINGER: The Financial Planning Coalition . . . is advocating the creation of an oversight board to regulate financial advisers. The Financial Planning Coalition proposes that the new overseer will impose fiduciary standards, training and ethics requirements for financial planning advice that favors consumers.

Not surprisingly, FINRA is also lobbying to expand its power and membership. It believes that it could well serve as the self-regulator for the RIA/IAR community and seems to be waging a fairly heavy duty campaign to secure that plum.

The Financial Planning Coalition isn't giving up without a fight. It views FINRA as little more than a modern-day Trojan Horse. In pushing back against the brokerage industry's unwanted intrusion, the coalition says that FINRA has no experience enforcing the higher Fiduciary Standard and may well be biased toward the lesser Suitability Standard. Likely to be raised as tensions mount, is FINRA's tarnished reputation as a result of its admitted investigative and regulatory failures in the Madoff and Stanford Financial frauds. . .

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