AARP and NASAA Introduce New Online Tool for Interviewing Advisers

The AARP and North American Securities Administrators Association (NASAA) have rolled out an online interview tool to help investors quickly get to the most salient issues when interviewing prospective investment advisers, reports Financial Advisor . The "Interview An Adviser" tool supplies a script for investors to use to focus on an adviser's experience, licensing, education, services and products offerings, compensation, and standard of care to determine whether the candidate is mandated to act as a fiduciary who is "obligated to act in the investor's best interest." The new tool effectively concentrates investors' attention on whether or not a financial professional functions as a fiduciary using a client best-interest standard, or is registered as a broker, using the looser suitability standard. "While registered investment advisers serve as fiduciaries who are required to provide advice that is in their clients' best interest, many other financial advisers operate under different requirements that obligate them only to make recommendations that are 'suitable,'" says the AARP's Jean Setzfand. "AARP's new interactive guide will help investors avoid confusion about a financial professional's standards and qualifications." The absence of a fiduciary rule for any financial professional who is not a registered investment adviser is the motivator for the new tool. "The U.S. Department of Labor DOL approved a fiduciary duty rule in 2016 requiring that advisers managing retirement savings accounts meet the 'best interests' standard," note the AARP and NASAA. "However, last year DOL announced a delay until 2019 in implementation of major provisions of the rule."