While there is a "small chance" that Securities and Exchange Commission Chairwoman Mary Schapiro will issue a proposed rule to put brokers under a fiduciary mandate by year-end, the most likely scenario is that, in the "short term (over the next three to four years), we aren't going to see any fiduciary rule with teeth," Knut Rostad, president of the Institute for the Fiduciary Standard, told AdvisorOne on Wednesday.
"I think regulators will continue to punt" the fiduciary issue, Rostad said. "In the short term at least, protecting the fiduciary standard will have to come from the advisory profession itself."
Indeed, Schapiro herself, who has been a staunch advocate of putting brokers under a fiduciary mandate, could likely be departing her post at the end of this year. Rostad and David Tittsworth, executive director of the Investment Adviser Association in Washington, say conventional wisdom is that it is unlikely Schapiro will continue as chairwoman next year, even if President Obama is re-elected.
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Melanie Waddell
Melanie is senior editor and Washington bureau chief of ThinkAdvisor. Her ThinkAdvisor coverage zeros in on how politics, policy, legislation and regulations affect the investment advisory space. Melanie’s coverage has been cited in various lawmakers’ reports, letters and bills, and in the Labor Department’s fiduciary rule in 2024. In 2019, Melanie received an Honorable Mention, Range of Work by a Single Author award from @Folio. Melanie joined Investment Advisor magazine as New York bureau chief in 2000. She has been a columnist since 2002. She started her career in Washington in 1994, covering financial issues at American Banker. Since 1997, Melanie has been covering investment-related issues, holding senior editorial positions at American Banker publications in both Washington and New York. Briefly, she was content chief for Internet Capital Group’s EFinancialWorld in New York and wrote freelance articles for Institutional Investor. Melanie holds a bachelor’s degree in English from Towson University. She interned at The Baltimore Sun and its suburban edition.
