I wonder what Scottish historical novelist and poet Sir Walter Scott would say of the oft-insidious nature of the financial services landscape. He who wrote the immortal words: “Oh! what a tangled web we weave, when first we practice to deceive!”[3]
Perhaps nowhere on Wall Street are these webs so intricately woven then when it comes to the subject of Fiduciary Responsibility.
Ultimately, to be successful and reputable, the financial services professional needs to understand and practice their fiduciary duty both in technical and in emotional terms.
Fiduciary Responsibility is a fundamental concept in the financial services industry. Basically, Fiduciary Responsibility is a structured legal and moral relationship of trust and confidence entered into by the client and service provider. In this relationship, the broker is the fiduciary or trustee, and the client is the principal or beneficiary.
At all times, the fiduciary must act in good conscience and faith for the benefit of the principal. The fiduciary is required to protect and be loyal to the principal. The principal’s interests come first. The behavioral standard for this type of relationship is extremely high and inviolate.
[3] From Marmion, Canto VI. Stanza 17; Marmion is an epic poem by Walter Scott about the Battle of Flodden Field published in 1513.