The arguments laid out in Pershing's white paper are reflective of broader controversy as regards the adoption of an expanded definition of fiduciary.
Dodd-Frank allowed the SEC to
establish a uniform standard for advisors and broker-dealers
providing personalized investment advice to retail customers. However,
disagreements have delayed the process and the authority has yet to
announce when, or if, it will proceed.
Many respondents to a recent survey claimed investors don’t
have the information required to choose of the type of advisor or sales
relationship they would like, and thus argue that clarification regarding the
roles of intermediaries - through titles, firm purpose and disclosure - is
Kathleen McBride, editor of the above-mentioned survey,
previously said that this issue is critical not just for
wealthy investors but for “investors of all stripes,” and especially for
people saving for retirement. In fact, 79 per cent of respondents agreed that ERISA (Employee
Retirement Income Security Act of 1974) fiduciary duty should cover
advice on rollovers out of 401(k)s and IRAs.