To know if someone is a fiduciary, look at three things: the role they hold, how they’re registered with regulators, and the specific service they’re providing to you at the moment. Some roles carry fiduciary duty automatically, like trustees, executors, attorneys, and agents under a power of attorney. In financial advice, it depends on registration: a Registered Investment Adviser owes you a fiduciary duty under federal law, while a broker-dealer operates under a lower standard even when a recommendation must be in your “best interest.” The verification isn’t a matter of taking someone’s word for it. You can check public databases, read two specific disclosure documents, and ask the professional to sign a written acknowledgment of fiduciary status for your engagement.
What Fiduciary Duty Actually Means
A fiduciary owes you two obligations at once. The duty of loyalty means your interests come ahead of the fiduciary’s own financial gain, their employer’s preferences, or any third party’s agenda. The duty of care means decisions are made with the skill and diligence a competent professional in the field would use, judged against what a reasonable professional would have done in the same position, not against the fiduciary’s own explanation.
Falling short on either one is a breach. That’s the standard you’re checking for when you try to determine whether someone is a fiduciary: are they legally bound to both of those duties in the specific work they’re doing for you?
Roles That Are Fiduciary by Default
Some positions impose fiduciary duty the moment a person steps into them. There’s nothing to negotiate and no way to opt out.
Trustees
A trustee holds legal title to trust property but manages it entirely for the beneficiaries. Trustees owe duties of loyalty, prudence, and impartiality, meaning that where a trust has multiple beneficiaries, the trustee cannot favor one over another. Self-dealing is prohibited, and the trustee is personally liable for a breach.1Legal Information Institute. Fiduciary Duties of Trustees Nearly every state has adopted some version of the Uniform Prudent Investor Act, which requires trust investment decisions to be evaluated as part of an overall strategy suited to the beneficiary’s needs.2Legal Information Institute. Uniform Prudent Investor Act
Executors and Estate Administrators
The person administering a deceased person’s estate becomes a fiduciary the moment the probate court issues letters testamentary or equivalent authorization. Their job is to inventory assets, pay creditors, file required tax returns, and distribute what remains to the heirs.3Internal Revenue Service. Responsibilities of an Estate Administrator
Attorneys
Lawyers owe fiduciary duties to their clients regarding confidential information, client funds, and conflicts of interest. An attorney cannot represent competing interests without informed consent and must keep client money separate in dedicated trust accounts. Each state enforces these obligations through professional conduct rules modeled on the American Bar Association’s framework.
Agents Under a Power of Attorney
When you grant someone power of attorney over your finances or property, that person becomes your fiduciary. Most states have adopted versions of the Uniform Power of Attorney Act, which requires agents to act in good faith, stay within the scope of authority granted, avoid conflicts of interest, and keep reasonable records of every transaction made on your behalf. An agent with special financial expertise is held to a higher standard of care. Families sometimes treat this role casually, but the legal obligations are serious.
Financial Advisors: Where the Confusion Lives
This is the setting where the question “is my advisor a fiduciary?” most often gets a misleading yes. The answer depends on how the person is registered, and sometimes on which hat they’re wearing during a particular transaction.
Registered Investment Advisers Are Fiduciaries
Registered Investment Advisers are fiduciaries under federal law. Section 206 of the Investment Advisers Act prohibits advisers from engaging in any practice that operates as fraud or deceit upon clients, and the SEC interprets this as imposing a broad fiduciary duty covering both care and loyalty.4Office of the Law Revision Counsel. 15 USC 80b-6 – Prohibited Transactions by Investment Advisers The duty is ongoing. An RIA has a continuing obligation to monitor your investments and flag problems as circumstances change, not just to give a good recommendation at the outset.5U.S. Securities and Exchange Commission. Commission Interpretation Regarding Standard of Conduct for Investment Advisers
Broker-Dealers Are Not Fiduciaries
Broker-dealers have historically operated under a suitability standard, which required only that a recommended product fit your general financial profile at the time of the sale. The SEC adopted Regulation Best Interest in June 2019, with broker-dealers required to comply beginning June 30, 2020.6U.S. Securities and Exchange Commission. Regulation Best Interest, Form CRS and Related Interpretations Reg BI requires broker-dealers to act in the retail customer’s best interest at the time of a recommendation and prohibits placing the broker’s financial interest ahead of the customer’s.7Securities and Exchange Commission. Regulation Best Interest – The Broker-Dealer Standard of Conduct
Reg BI is not a fiduciary standard. It applies only at the moment of the recommendation, not on an ongoing basis. Once a broker sells you a product, they have no continuing duty to monitor whether that product remains in your best interest. If your broker uses the phrase “best interest,” that reflects Reg BI, not fiduciary duty.
Dual-Registered Professionals
Many financial professionals are registered as both an investment adviser representative and a broker-dealer. When they provide advisory services, they operate under the fiduciary standard. When they sell products on commission, they may operate under Reg BI. The same person can switch between these standards depending on the transaction, and they aren’t always transparent about the switch. If your advisor earns commissions on some products and fees on others, ask which standard applies to each specific recommendation before you agree to anything.
Certified Financial Planners
The CFP designation is a private credential issued by the CFP Board, which imposes its own fiduciary standard on top of whatever regulatory framework applies. A CFP must act as a fiduciary at all times when providing financial advice to a client, with duties of loyalty, care, and following client instructions.8CFP Board. CFP Professionals Responsibilities When Working as Part of a Team The credential doesn’t carry the force of federal securities law, but it adds accountability through the CFP Board’s disciplinary process.
Retirement Plan Advice Has Its Own Rules
Advice on your 401(k), 403(b), or other employer-sponsored retirement plan is governed by a separate federal law. The Employee Retirement Income Security Act defines a fiduciary as anyone who exercises decision-making authority over a plan, renders investment advice for compensation, or has administrative responsibility over the plan.9Office of the Law Revision Counsel. 29 USC 1002 – Definitions
For the investment advice category, the Department of Labor applies a five-part test that requires the advice to be individualized, rendered on a regular basis, pursuant to a mutual agreement, and intended to serve as a primary basis for investment decisions. A 2024 rule that would have broadened this definition was vacated by the courts, and as of March 2026 the DOL has restored the original five-part test.10U.S. Department of Labor. US Department of Labor Restores Long-Standing Investment Advice Rule After Pair of Court Decisions Vacate 2024 Retirement Security Rule
The practical consequence: a one-time recommendation about your retirement plan investments may not trigger fiduciary status for the person giving it, because the five-part test requires an ongoing relationship. If you want fiduciary protection for a retirement account, confirm that the engagement meets all five criteria, or work with an RIA who owes you fiduciary duty under the Investment Advisers Act regardless.
How to Verify Fiduciary Status Independently
Asking someone “are you a fiduciary?” is a starting point, but it isn’t enough. A dual-registered professional can truthfully say yes while acting as a fiduciary only for part of what they do. These steps let you confirm the answer for yourself.
Search the SEC’s Investment Adviser Public Disclosure Database
The SEC maintains a free, searchable database at adviserinfo.sec.gov for every registered investment adviser. It shows the firm’s Form ADV, how the firm is compensated, what conflicts of interest exist, and any disciplinary events. Individual adviser representatives also appear, with employment history and any personal disciplinary actions.11Investment Adviser Public Disclosure. Investment Adviser Public Disclosure – Homepage
Read Form ADV Part 2
Form ADV Part 2, sometimes called the adviser’s brochure, is the single most useful document for figuring out how an advisor operates. Federal law requires it to disclose fiduciary obligations, all material conflicts of interest, fee structures, and whether the adviser or its employees receive compensation for selling specific products.12U.S. Securities and Exchange Commission. Form ADV Part 2 If an advisor can’t or won’t hand this document over, treat that as a red flag on its own.
Request Form CRS
Since June 2020, both RIAs and broker-dealers must provide retail investors with a Form CRS relationship summary. It spells out the type of relationship the firm offers, the standard of conduct that applies, how the firm is compensated, and whether the firm has any reportable disciplinary history.13U.S. Securities and Exchange Commission. Form CRS Relationship Summary – Amendments to Form ADV Reading Form CRS alongside Form ADV Part 2 gives you a clear picture of whether the person is a fiduciary, a broker operating under Reg BI, or both at different moments.
Run the Name Through FINRA BrokerCheck
For anyone who sells securities or works at a brokerage firm, FINRA’s BrokerCheck at brokercheck.finra.org shows registration status, employment history, and any regulatory actions, arbitrations, or customer complaints.14FINRA. BrokerCheck – Find a Broker, Investment or Financial Advisor If someone claims to be registered but doesn’t appear in either the IAPD database or BrokerCheck, they may not be registered at all.
Ask Two Direct Questions
Two questions cut through most of the ambiguity. First: are you registered as an investment adviser, a broker-dealer, or both, and which capacity will you be acting in for my engagement? Second: will you sign a written fiduciary acknowledgment covering the services you’re providing to me? A genuine fiduciary has no reason to refuse. Someone who hedges, says they follow a “fiduciary philosophy,” or claims their standard is “like” fiduciary duty without committing to it in writing is telling you something.
What Fiduciary Behavior Looks Like in Practice
Confirming that someone is a fiduciary on paper matters less if you can’t tell whether they’re acting like one.
A fiduciary cannot enter into transactions that benefit themselves at your expense. If your advisor recommends a fund managed by their own firm, or earns a bonus for selling a particular product, that conflict must be disclosed to you in enough detail that you can evaluate whether it shaped the recommendation. Vague disclosures buried in fine print do not meet the standard.
Fees must be reasonable relative to the complexity of the services provided. A 2% annual charge on a straightforward index fund portfolio invites scrutiny because the fee doesn’t match the work. You’re entitled to a clear accounting of every fee, including indirect costs like fund expense ratios that reduce returns without appearing on your statement.
A fiduciary managing investments has an ongoing duty to review them. If your risk tolerance changes, market conditions shift, or a holding underperforms its peers consistently, the fiduciary is expected to act. “Set it and forget it” management, where an advisor collects fees year after year without meaningful review, is the classic breach. Regular statements showing all transactions and performance data are part of what you should expect to receive.
If any of these expectations aren’t being met, the person may still technically be a fiduciary while failing at the job. Documentation of the gap — agreements, statements, emails, records of what you were told versus what happened — is what turns a suspicion into a claim, so keep it as you go.