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|What's the Difference Between 'Sole' Interest and 'Best' Interest?|
May 13, 2015
"Strictly speaking, a sole interest standard forbids even mutually beneficial transactions or compensation for the advisor. Just the opportunity for impropriety is enough to violate this standard, even if no actual harm occurs.... A best interest standard ... allows for the fact that sometimes beneficiaries stand to gain the greatest benefit when the fiduciary can also benefit.... The upside of a best interest standard vs. a sole interest standard is that it incentivizes quality of services and allows for such benefits as economy of scale. The downside is that it is more open to interpretation and ripe for abuse if not carefully monitored."
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