The Financial Planning Coalition’s Efforts to Advance a Strategy to Establish Regulatory Recognition of the Financial Planning Profession

There is a great deal of discussion among policymakers about harmonizing the regulation of broker-dealers and investment advisers. Various reform proposals do not currently address one of the most serious concerns of financial planners – the large number of practitioners holding themselves out as providing financial advice without having met the competency, practice or ethical standards needed to protect consumers.

The Coalition's proposal serves as an alternative, in keeping with the best interests of consumers and the profession. While we are still refining implementation details, we wish to share the broad concepts of the proposal. It would:

  • Establish a professional standards-setting oversight board that would be subject to federal authority and oversight;
  • Require individuals (not firms) who provide financial planning advice to individuals or families, or who hold themselves out as a financial planner or advisor (or similar title), to be subject to the board's oversight; 
  • Direct the board to establish competency, practice, and ethics standards of training, experience and competence in consultation with the financial planning profession and subject to SEC review and approval; 
  • Direct the board to establish rules to promote the delivery of financial planning advice at a bona fide fiduciary standard of care;
  • Direct the board to grant reasonable industry exemptions from oversight for otherwise regulated persons similar to those exempted under the Advisers Act to avoid overlapping regulation; and
  • Authorize the board to enforce its rules and standards in cooperation with other financial services authorities.

Representatives of the Coalition are meeting with policy makers in Congress and with consumer and industry organizations to discuss our goals and conceptual proposal. We seek input as we work to further refine the details.

For further information on this topic, click here [PDF].