FA Insights is a daily newsletter from Business Insider that delivers the top news and commentary for financial advisors.
A Utah man who allegedly fooled investors with “top secret” Iraqi currency and oil contract deals was charged by the SEC (FA Magazine)
John Scott Clark, a Cache County, Utah man who allegedly “solicited investors for ‘top secret’ Iraqi currency and oil contract deals,” was charged with fraud by the SEC, reports Karen Demasters.
Clark previously pleaded guilty in 2009 to criminal bank fraud, money laundering, and illegal gambling charges. Additionally, the SEC charged him with operating a $47 million Ponzi scheme back in 2011.
The Department of Labour will release its fiduciary rule on Wednesday (Financial Planning)
The DOL is set to announce the new fiduciary rule on Wednesday, sources confirmed to Ann Marsh and Andrew Welsch. The rule will require advisors and wealth managers to place their clients’ interests above their own when advising on retirement accounts.
“By implementing it, the Obama administration aims to reduce the $17 billion that the White House Council of Economic Advisors estimates Americans lose annually to conflicted financial advice on their retirement accounts,” note Marsh and Welsch.
Wealthfront will start using AI (Yahoo Finance)
Robo-advisor Wealthfront announced that it will start incorporating artificial intelligence into its financial services to better personalise the advice given to customers, reports Melody Hahm.
“In addition to looking for hidden fees and cash drag, Wealthfront’s AI will track your account activity and automatically apply that behaviour to the advice the company gives you,” Hahm reports.
JPMorgan private bankers who oversaw $1.2 billion left the firm last month to found Miami-based Element Pointe Advisors, reports Hugh Son. This move falls in line with a larger trend of brokers leaving the big banks in a time when new technology makes trading and data analysis easier.
“New offerings include software from Mountain View, California-based Addepar that helps track exposures across a portfolio, update investment values in real time and generate reports at the push of a button. The startup shares a co-founder with Palantir, the CIA-backed data-gathering firm,” reports Son.
It’s important to be mindful of investment taxes (Charles Schwab)
“When it comes to income, it’s not what you make, but what you keep after taxes that counts. And these days, with higher capital gains taxes and the 3.8% Medicare investment income surtax (which affects certain filing status thresholds), being mindful of investment taxes is more important than ever,” writes Rande Spiegelman.
Generally speaking, “tax-smart investors hold tax-efficient investments in taxable accounts and less tax-efficient investments in tax-advantaged accounts,” he writes. “‘Tax diversification’ can be important if you’re uncertain about which tax bracket you’ll end up in retirement and can also help with charitable giving and estate planning goals.”
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