Enjoy the current installment of “weekend reading for financial planners” – this week’s edition kicks off with the big news that the Massachusetts state securities regulator has accused retail brokerage firm Scottrade of violating the Department of Labor’s fiduciary rule by holding a series of “sales contests” in the second half of 2017, as even though the full Best Interests Contract Exemption is delayed until the middle of 2019, the requirement to satisfy the Impartial Conduct Standards of the DoL fiduciary rule did take effect last June 9th of 2017… and raising the question of whether Massachusetts will soon be scrutinizing other major firms for similar fiduciary compliance violations. And in a similar vein, the SEC also announced this week new “Share Class Selection Disclosure” Initiative that will grant amnesty to RIAs (especially hybrid RIAs) that may have failed to disclose that they were using higher-cost share classes that included 12b-1 fees (paid to a related broker-dealer) without disclosing that there were lower cost alternatives available (but only if the firm self-discloses its error, and refunds all excess profits earned from clients).
From there, we have several advisor technology articles, including a brief recap of the latest 2018 Advisor Software Survey from Joel Bruckenstein and Bob Veres, two reviews of the big news and announcements at the recent T3 advisor technology conference, and a fascinating profile of some of the major private equity and venture capital investors that have been putting money into the burgeoning number of new advisor tech startups that are well-funded with outside capital and not merely “homegrown” solutions built by advisors themselves and re-sold to their peers.
We also have a few articles on the ongoing trends of advisors retiring, merging, and being acquired, including tips for RIAs that are looking to sell about what they should do to find the right buyer, a look at the landscape for broker-dealer recruiting (which is especially hot amongst the largest independent broker-dealers, who are attracting reps from both wirehouses and smaller IBDs), and some advice from Bob Veres on how advisors should think through their own potential retirement (which isn’t just about the financial matters of selling your practice, but is primarily about finding your own new purpose in a world where your primary focus may no longer be your advisory firm!).
We wrap up with three interesting articles, all around the theme of telecommuting and whether working remotely may not be all it’s cracked up to be: the first looks at how working from home is associated with a dangerous rise in loneliness and isolation, which is both leading employees to want to go back and work from an office again, and can even have deleterious health effects; the second examines how working from home also appears to be impairing everything from the innovation to customer service of a number of large firms, which are shifting from telecommuting and remote work policies to more of a “flexible work” policy that allows some work from home but still requires employees to come into the office on most days; and the last explores the rise of co-working spaces, which provide helpful office space and business infrastructure for those who don’t have a good setup at home, but are proving to be popular primarily because of the social and community aspects of co-working (as contrasted, once again, with the potential isolation and loneliness of working from home). Which means at a minimum, those who are interested in working from home – including solo advisors who don’t have an office – need to be mindful of the need to maintain a social network of friends and colleagues, at least in the form of a co-working space.
Enjoy the “light” reading!