Yes, I’m referring to the Transportation Security Administration. And yes, the TSA is on everyone’s short list of least loved government agencies. Still, TSA would do a better job of administering a fiduciary standard of care than either the DOL or the SEC.
Here are 5 reasons why:
1. TSA “gets” procedural prudence:TSA has multiple layers to its screening procedures; it doesn’t rely on one point-in-time intervention. Both the DOL and SEC believe that the execution of a complex disclosure document at the beginning of a client engagement is all that is required to provide a client a fiduciary standard of care.
2. TSA knows the value of Pre √:TSA mantra -the more we know about you, the less we have to touch you.The agency knows how to build a risk profile on a particular traveler – why can’t the DOL or SEC design a similar process for building a risk profile on every broker and advisor. Imagine how much the public would value a Pre√ on an advisor’s or broker’s business card?
3. TSA knows how to communicate:TSA talks to more than 2 million passengers every day. They know how to provide simple, precise instructions. A fiduciary standard is not complicated. If you know what you’re talking about, you can describe a fiduciary process with less than 100 words. The DOL and SEC don’t know what they’re talking about, which is why – with even 1,000 pages – they can’t define a fiduciary standard.Related:
Are You an Adviser or an Advisor? 4. TSA is apolitical:TSA doesn’t care about your political leanings – “left” and “right” are both required to take off their shoes. When the fiduciary movement was started 30 years ago the primary objective was to improve the management of investment decisions. It never had a political agenda. Shame on both the DOL and SEC for allowing politics, power, ego and greed to destroy a noble cause.
5. TSA knows it needs to improve:What all three government agencies share in common is that their regulations give the public a false sense of security. During tests, TSA screeners still miss more prohibited items then they find. TSA owns it shortcomings and is working harder to improve outcomes. The attitude of the DOL and SEC is just the opposite. Neither regulator has owned up to doing a lousy job of defining a fiduciary standard. When you listen to the DOL and SEC you can’t help but think of the fictitious telephone operator, Ernestine, portrayed by Lily Tomlin:We're the phone company[DOL, SEC]. We don't care; we don't have to.Yes, I’m being facetious. However, when a critical debate has been reduced to babble, humor often is the last and most appropriate response.
