In light of the lawsuit actor Johnny Depp filed against the company he hired to manage his finance and the countersuit the group filed alleging that Depp spent money recklessly, New York Times columnist Charles Duhigg wrote a column looking at some of the concepts behind the lawsuit and how it connects to an ongoing debate at the federal level about the fiduciary standard, a set of regulations requiring financial advisers to give advice based on their clients’ best interest instead of advice based on what the adviser believes will get them the highest fee.
The Obama Administration asked the Department of Labor to start forcing financial advisers across the country to abide by these rules in 2015, but their implementation was left incomplete upon President Obama’s departure from the presidency, and it remains unclear how the Trump Administration will proceed with either continuing to implement the rule or dismantling it.
While the lawsuit itself is an anomaly in the sense that Mr. Depp is an insanely wealthy actor with a massive fortune to oversee, it does raise the question of where responsibility for managing money lies when someone hires a financial planner, especially when questionable spending or investing practices are at play. Today on AirTalk, we’ll talk with a couple of local financial planners about the pros and cons of a universal fiduciary standard, the concerns that critics have, and what might happen next with the federal fiduciary standard.
Delia Fernandez, fee-only certified financial planner and investment advisor with Fernandez Financial Advisory, LLC
Victor Robinette, certified public accountant, certified financial planner, and principal and owner of the South Pasadena Raymond James branch office