What is a fiduciary?

You want an advisor you can trust. This begins with choosing an advisor working under a fiduciary level of care.

All members of the Orange County Financial Advisors Network must operate as fiduciary advisors in all aspects of their practice at all times.

The Fiduciary Rule Explained

The fiduciary standard of care requires that a financial adviser act solely in the client’s best interest when offering personalized financial advice.

All advisors of the Orange County Financial Advisor Network are proponents of the fiduciary rule and strongly support that the fiduciary standard of care be the standard for the financial planning profession.

More information about the fiduciary standard of care is available at the Financial Planning Coalition’s website; here.

Who follows the fiduciary standard?

Under the Investment Advisers Act of 1940, federal law, investment advisers are regulated by the Securities and Exchange Commission (SEC) or appropriate state authorities and are required to provide services to their customers under the fiduciary standard. Furthermore, CERTIFIED FINANCIAL PLANNER™ professionals that provide financial planning services must also abide by the fiduciary standard of care, as defined by CFP Board.

Broker-dealers are also regulated under federal law, including under the Securities Exchange Act of 1934, but are not required to provide services to their clients under the fiduciary standard. Instead, broker-dealers provide services under “Regulation Best Interest” which is an attempt to make conflicted brokers more fiduciary-like. This has further muddied the water, especially for consumers. When in doubt, ask your financial advisor (or potential financial advisor) if they operate by the “fiduciary standard of care” and have them procure their fiduciary oath.

Why is this important?

Countless individuals and families are harmed every year by financial advisors not acting in their best interest. Unfortunately, like other industries such as law and medicine, there is not yet a uniform fiduciary standard that applies to all financial professionals who provide personalized investment advice, from paying excessive fees and commissions to receiving substandard performance. Consumers are exposed to even greater and unnecessary risks from products that may be deemed suitable for them but are inferior to other available options and not necessarily in their best interests.

You can rest assured that every advisor in our network is a fiduciary advisor.