Exposure Items

Fiduciary Liability Exposure Checklist

Pitfalls for Attorneys, Business Managers and CPAs

  • Providing investment advice to clients whether or not you receive compensation
  • Drawing the line between investment advice and legal, financial or tax advice
  • Serving as trustee to accommodate a client who doesn’t want heirs to know or be involved
  • Recommending any investment, stockbroker, financial planner or insurance agent to a trustee then failing to monitor the situation; among other things, personnel turnover happens, communication and compliance may erode.
  • Receiving any remuneration or compensation for referrals, investments or insurance, etc.


Steps to consider to insulate your professional practice:

  • Identify potential fiduciary risk exposure areas in your practice
  • Review E&O insurance for coverage or exclusions related to investment fiduciary activities
  • Inform clients who act as trustees of fiduciary responsibilities and liability
  • Alert clients of potential liability before they accept a trustee or board position on a non-profit
  • Become familiar with federal and state laws concerning investment fiduciary standards of care:
  • Uniform Prudent Investor Act (UPIA)
  • ERISA, Taft-Hartley Act (Union, multi-employer plans)
  • Uniform Management of Public Employee’s Pension Systems Act (state, county, city plans) (UMPERs)
  • Uniform Prudent Management of Institutional Funds Act (UPMIFA)


In nearly every dispute whether trust or non-trust account, IRA, ERISA pension retirement benefit or 401k, 403b plan, charity, non-profit, foundation or endowment account, at the outset parties form a trusting relationship, promises are made, expectations are created, reliance and often complacency can take root, disappointments occur, communication wanes, account values continue to suffer, risks increase, prudence gaps manifest then arbitration claims or lawsuits are filed.

It’s best if we can be retained prior to the establishment of the new account (or new advisory) relationship to help prevent these types of situations  When lawsuits or claims are contemplated we prefer to be involved at the earliest opportunity prior to filing.

For concerns related to breach of fiduciary duty, self-dealing, conflict of interest or malfeasance or violations of FINRA or SEC securities industry rules and regulations please contact us at:

Seek an independent, third party opinion from us; it counts as due diligence.

For more information info@fiduciaryexpert.com or (310) 943 – 6509

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