The fiduciary debate is dominating the political agenda in the financial advisory world, but it isn't the only unsettled business in the industry.
An equally important issue is making sure that fiduciary investment advisors—who are required to always act in the best interests of their clients—are actually doing that.
It's almost universally acknowledged that the current regime for examining the approximately 11,500 registered investment advisors in the country is inadequate. The Securities and Exchange Commission—the primary regulator of the industry—examines about 10 percent of those RIA firms annually, and state securities regulators are now responsible for overseeing firms with less than $100 million in assets.
There is still, however, a major gap in oversight. The average firm is examined once every 10 years, and about 40 percent of firms nationwide have never been examined, according to various industry data.