Will congress step forwardIn a recent Forbes article, Edward Siedle suggested that additional subpoenas may be issued to pension advisors in connection with New York’s investigation of the pension consulting industry. The questionable practices within the pension industry are well known, both by those within the industry and the legal community.

These same abusive practices harm regular investors as well. A 2007 InvestmentNews article, citing a study by Schwab Institutional, reported that an estimated 75 percent of client accounts transferred from brokerage houses were consistently inconsistent with  the clients’ financial goals. Advisors responded by saying that they were only surprised that the numbers were not higher, an opinion that I would agree with. An industry expert’s response – “we’ve always known it.”

Again, both the financial services and the legal industry are well aware of these abuses. The knowledge of these ongoing abuses makes the House’s recent decision to ignore reality and to protect the financial services, at the cost of the public, even more troubling. A universal fiduciary standard would provide both plan participants and everyday investors with protection against such abusive practices.

Aldous Huxley once said that “facts do not cease to exist because they are ignored.” Stories of investment abuse have become a regular aspect of the news. What both Congress and the financial services both need to realize is that the quality of investment advice, not the quantity of advisors, should be the primary concern. The facts clearly indicate that too many investors are receiving poor investment advice, advice that often puts the advisor’s financial interests ahead of those of the investor.

Hopefully, Congress and the regulatory responsible for protecting investors against such abusive investment practices will step forward, ignore the disingenuous arguments put forth by the financial services industry and provide investors of all kinds with the protection they so desperately need and deserve.

To learn more about James Watkins, visit his site at www.investsense.com.