Trustees Need to be Aware of New SEC Disclosure Requirements that Apply to Financial Advisers

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Trustees who retain financial advisers to invest trust assets now have access to dramatic new disclosure documents that include conflicts and disciplinary history, explains Julie Jason in "Raising the Bar," published today by Trusts and Estates Magazine today. Will these new documents raise the bar for due diligence? What should trustees and lawyers know about these new disclosure documents?

"It is crucial for a fiduciary to understand the nature of the investment advice he or she is receiving,"

SEC disclosure requirements effective Sept. 30, 2011 impact trustee selection of financial advisers and potentially raise the bar when it comes to due diligence, explains attorney and money manager, Julie Jason in her article, "Raising the Bar," published today by Trusts & Estates Magazine. Trusts & Estates is the preeminent, peer review journal and website for wealth management professionals serving the needs of high-net-worth clients, family business owners, family offices, charitably inclined donors and nonprofit corporations.

"Instead of cobbling together information on their own, now for the first time, trustees will be able to see a full picture of services, fees, disciplinary history and conflicts of interest — all the things that a dutiful fiduciary must explore, understand and assess before hiring (or continuing to retain) a financial adviser to invest trust assets," says Jason.

Jason explains the new disclosure requirements, discusses the types of advisers who must provide the disclosure (including large dually registered broker/dealers), and the impact of this information on trustees and other fiduciaries who retain financial advisers.

"It is crucial for a fiduciary to understand the nature of the investment advice he or she is receiving," says Jeffrey A. Cooper, Professor of Law, Quinnipiac University School of Law and Academic Fellow of ACTEC, the American College of Trust and Estate Counsel.

"There can be a world of difference between a truly independent investment adviser and a broker who is compensated for selling financial products. Fiduciaries must understand these key differences," says Cooper. "Hopefully, these new disclosures will be a valuable tool in this effort."

Julie Jason, JD, LLM, began her Wall Street career as a lawyer. She is co-founder of Jackson, Grant Investment Advisers, Inc. of Stamford, CT, an SEC registered investment adviser. Previously, she served as assistant general counsel of a major broker/dealer, president of its managed futures subsidiary, and president of its trust company.

A proponent of financial literacy, Jason writes and speaks about law and investment topics.

She is the author of "Managing Retirement Wealth: An Expert Guide to Personal Portfolio Management in Good Times and Bad" (Sterling 2011) and the "AARP Retirement Survival Guide," which was named a Top 10 Business Book for 2010 by Booklist (the American Library Association) and received * The EIFLE Award (Excellence in Financial Literacy Education - 2010); * The International Book Award for Personal Finance (2010); * The National Best Books Award for Personal Finance (2010); and * The Axiom Gold Medal for Retirement Planning (2011).

Her award-winning weekly investor education column, which is in its 13th year of publication, appears Sundays in the Greenwich Time, the Stamford Advocate, the Connecticut Post, and the Danbury News Times. Readers address questions to Jason at readers(at)juliejason(dot)com.


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Julie Jason