New Rules Look to Raise Fiduciary Standards. We’ve Been There for Years.

Thursday, February 14, 2019

A devotion to transparency ensures that both our employees and our retirement plan clients get service free of hidden agendas.

sec fiduciary responsibility

By Eric Sholberg, AIFA

Last year, the Securities and Exchange Commission (SEC) proposed an investment-advice rule that—if implemented—would alter the standard of conduct of broker-dealers and provide more clarity around the relationship between individual investors and their investment professionals. The SEC effort was prompted in part by the regulatory uncertainty generated by the Department of Labor’s 2016 “fiduciary rule,” one that was recently vacated by the Fifth Circuit Court of Appeals. In short, the SEC rule aims to hold financial advisors to a higher standard. At Brighton Jones, we’re already there.

The Highest Level of Fiduciary Responsibility

The Retirement Plan Advisory Group at Brighton Jones maintains an ERISA 3(38) position across our entire investment lineup. Most others in the industry won’t take that level of fiduciary responsibility because they are afraid to take on the liability that comes along with it. At Brighton Jones, adopting a complete investment fiduciary stance aligns with the original principles on which we were founded.

Our founders, Charles Brighton and Jon Jones, saw an opportunity to offer comprehensive advice across a client’s entire balance sheet and only receive compensation from our client. At the time, the financial advisory model was utterly broken—sales were paramount, not service. Far too many advisors pushed esoteric financial arrangements and limited investment options that would net them the highest commission, the best interests of their clients be damned.

Our clients receive the same services, solutions, and investment options as those we offer within our own company retirement plan.

From day one, Brighton Jones has delivered objective, fee-only advice our clients deserve. While transparency in the financial industry has improved in the two decades since our founding, we’re still ahead of the curve with our relentless focus on the most underrated business model in the world: do the right thing for your client and they will appreciate it and tell their friends.

Built-in Oversight

How does this relate to investments? We practice what we preach: our clients receive the same services, solutions, and investment options as those we offer within our own company retirement plan. What we’ve come to expect in our plan is what we deliver to our clients—it’s as simple as that.

This approach offers an added benefit: our own employees act as a feedback loop. More than 170 financial professionals participate in our 401(k) plan; if any of them spotted a feature that was not in their best interests, they would alert us to the problem! A devotion to transparency and getting it right ensures that both our employees and our retirement plan clients get service free of hidden agendas.

Nothing to Hide

Although fee disclosure became required by law in 2012, many service providers in the retirement plan industry publish multi-page documents with countless fee contingencies due to their murky revenue and fee-sharing arrangements. We have one number: the fee our clients pay us. We don’t have kickback clauses with other vendors and we don’t sell products.

For us, fiduciary responsibility isn’t defined by law—it’s the only way we have ever operated and our clients will let us know if we ever stop delivering on that commitment.

Reach out to our team of retirement plan advisors for a complimentary and independent fiduciary fee analysis of your current providers.

Eric Sholberg, AIFA serves as a retirement plan advisor at Brighton Jones.

Read more from our blog:

New on Our Blog

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Brighton Jones LLC), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained on this blog serves as the receipt of, or as a substitute for, personalized investment advice from Brighton Jones LLC.

To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Brighton Jones LLC is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the Brighton Jones LLC’s current written disclosure statement discussing our advisory services and fees is available for review upon request.

Brighton Jones is not affiliated with Facebook, Twitter, LinkedIn, Google+, YouTube or other social media websites and we have no control over how third-party sites use the information you share. Please remember that you should never communicate any personal or account information through social media and it is important to familiarize yourself with their respective privacy and security policies.

Pin It on Pinterest