SAN DIEGO - Financial regulatory reform was the buzz Thursday at TD Ameritrade Institutional’s National Conference.

“We don’t need more regulation, we need better regulation,” said Tom Bradley, president of TD Ameritrade Institutional, in the opening session of the conference.

Michael H. Wong of M2 Investment Advisors Inc. agrees. Over lunch he said: “Regulation just for regulations sake is unhelpful.”

Whether or not the financial services industry wants more regulation, it’s coming, which is why the afternoon session on “The Real Impact of Financial Regulatory Reform” was standing-room only.

“Something has gone very wrong in Washington,” said Tom Giachetti of Stark & Stark Attorneys at Law. “You cannot catch criminals through more regulation. Investment advisors will be burdened with more costs and it’s not protecting the investing public. This is a knee jerk reaction to Bernie Madoff.”

It seems clear that the Securities and Exchange Commission does not agree. Marilyn Mohrman-Gillis of the Certified Financial Planner Board of Standards said that a study conducted by SEC staff recommended a uniform fiduciary standard of care for both investment advisors and broker dealers. “You cannot just import broker dealer regulations and place them on advisors,” she said. “They just don’t fit.”

So, what are the implications for the advisor community and what are the next steps?

The SEC’s job is done now that it’s done a study. Whether or not it will implement the fiduciary standard is up in the air. “The SEC has a lot on its plate with Dodd-Frank,” said Mohrman-Gillis. “I think we need to continue to try to use our voice and put pressure on the SEC to continue with rulemaking. The bottom line is reform is not immediate it will take time.”

Meanwhile, those who are hoping Dodd-Frank is a temporary fix may be disappointed.

“I don’t think Dodd-Frank will be repealed,” said David Tittsworth of the Investment Advisor Association. “It will mean more regulation and more oversight.”

Yet the SEC staff can’t keep up with the growing number of advisors. With only 460 employees and 11,000 advisors, not including investment companies, to oversee, it seems clear that the SEC will have a hard time overseeing every advisor.

Don Trone of Strategic Advisors said that he doesn’t think regulatory reform is the biggest issue. He said a lack of training and education in the industry is the challenge. “Beauticians,” he said, “have more stringent education and training than financial advisors. Even if we implement all 2,300 pages of the Dodd-Frank act the biggest net loser is investment advisors.

“There is nothing in the Dodd-Frank Act that will raise the professional bar,” he said. “You are losing the critical differentiator because you can no longer say you are a fiduciary and the broker is not.”

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