Fiduciary

A Fiduciary is a person who holds a legal or ethical relationship of trust with one or more other parties (person or group of persons).

• See: Financial Adviser, Financial Planner.

---

---

References

2023

• chat
  • Q: What kinds of fiduciaries are there?
  • A: There are several types of fiduciaries, including:
    • Trustees: responsible for managing and administering a trust on behalf of the beneficiaries.
    • Executors: responsible for managing and distributing the assets of a deceased person according to their will.
    • Guardians: responsible for the care and well-being of a minor or incapacitated individual.
    • Agents under a power of attorney: authorized to make financial and legal decisions on behalf of another person.
    • Investment Advisers: responsible for providing investment advice and managing assets on behalf of clients.
    • Pension trustees: responsible for managing and investing the assets of a pension plan and ensuring that benefits are paid out to plan participants.
  • All of these fiduciaries are held to a high standard of care and are legally obligated to act in the best interests of the individuals or entities they represent. ...

2023

• (Wikipedia, 2023) ⇒ https://en.wikipedia.org/wiki/fiduciary Retrieved:2023-1-29.
  • A fiduciary is a person who holds a legal or ethical relationship of trust with one or more other parties (person or group of persons). Typically, a fiduciary prudently takes care of money or other assets for another person. One party, for example, a corporate trust company or the trust department of a bank, acts in a fiduciary capacity to another party, who, for example, has entrusted funds to the fiduciary for safekeeping or investment. Likewise, financial advisers, financial planners, and asset managers, including managers of pension plans, endowments, and other tax-exempt assets, are considered fiduciaries under applicable statutes and laws. In a fiduciary relationship, one person, in a position of vulnerability, justifiably vests confidence, good faith, reliance, and trust in another whose aid, advice, or protection is sought in some matter. In such a relation, good conscience requires the fiduciary to act at all times for the sole benefit and interest of the one who trusts. Fiduciary duties in a financial sense exist to ensure that those who manage other people's money act in their beneficiaries' interests, rather than serving their own interests. A fiduciary duty is the highest standard of care in equity or law. A fiduciary is expected to be extremely loyal to the person to whom he owes the duty (the “principal") such that there must be no conflict of duty between fiduciary and principal, and the fiduciary must not profit from their position as a fiduciary. (unless the principal consents). The nature of fiduciary obligations differs among jurisdictions. In Australia, only proscriptive or negative fiduciary obligations are recognised, whereas in Canada, fiduciaries can come under both proscriptive (negative) and prescriptive (positive) fiduciary obligations. In English common law, the fiduciary relation is an important concept within a part of the legal system known as equity. In the United Kingdom, the Judicature Acts merged the courts of equity (historically based in England's Court of Chancery) with the courts of common law, and as a result the concept of fiduciary duty also became applicable in common law courts. When a fiduciary duty is imposed, equity requires a different, stricter standard of behavior than the comparable tortious duty of care in common law. The fiduciary has a duty not to be in a situation where personal interests and fiduciary duty conflict, not to be in a situation where their fiduciary duty conflicts with another fiduciary duty, and a duty not to profit from their fiduciary position without knowledge and consent. A fiduciary ideally would not have a conflict of interest. It has been said that fiduciaries must conduct themselves "at a level higher than that trodden by the crowd" and that "[t]he distinguishing or overriding duty of a fiduciary is the obligation of undivided loyalty".

---