regulating robos

Increased Scrutiny of Robo-Advisors

Personal Capital defends its position

SAN CARLOS, Calif., January 18, 2017 /PRNewswire/ — The Securities and Exchange Commission (SEC) announced its 2017 exam priorities, adding robo-advisors to the list, according to Investment News today.

“Point one,” said Bill Harris, CEO of Personal Capital, “Personal Capital has already participated in an examination with the SEC. Point two, we are not a robo-advisor. I have been running around the country ever since the term ‘robo-advisor’ was coined imploring anyone who would listen, ‘Don’t call me a robo!'” Some of the reasons that Personal Capital is not a robo-advisor include:


  • It offers the most comprehensive personal finance software available to both its clients and to any individual or family for free.
  • It offers the most comprehensive financial planning software available – also to both clients and free users.
  • It offers investment management services that are everything that the simplistic algorithmically based ETF-only robo-advisors offer – plus a level of sophistication and personalization that greatly exceeds that relatively low bar.
  • It serves clients who are in a very different demographic, socioeconomic and psychographic group, with very different needs than the clients of robo-advisors. As one example, the average assets of Personal Capital’s clients is over $300,000, whereas the average assets of the leading robo-advisors is well less than $50,000.
  • Finally, in addition to all of the software-based tools and capabilities, Personal Capital provides dedicated, licensed and independent financial advisors who work directly with each client.

“This is the magic formula,” said Harris. “It’s one plus one equals three. I truly believe we’ve designed the future of financial advice – that ten years from now most financial institutions will be seeking to do what we do today.”

“To me, the term ‘robo-advisor’ is half true,” continued Harris. “They are robo, but they’re not advisors. Our mission statement is simple: ‘Better financial lives through technology and people.’ I think that says it all.”

Personal Capital is a fiduciary of its clients’ money – meaning that it is required to (and desires to) offer advice in the best interest of its clients, not of the firm itself. Brokers are not fiduciaries. Recently approved rules from the Department of Labor are scheduled for implementation in April of this year, and would require even brokers to operate as a fiduciary when selling 401k, 403b and Individual Retirement Accounts. These new rules have faced fierce opposition from brokers and from the well-financed financial services lobby. The incoming administration has indicated it may delay or repeal these rules. Personal Capital believes the repeal of these regulations would be a disservice to all investors attempting to provide for a secure retirement.

To learn more about Personal Capital, visit here.




About Personal Capital
Personal Capital is the smart way to track and manage your financial life. Personal Capital combines award-winning online financial tools that provide unprecedented transparency into your finances with personal attention from licensed financial advisors. The result is a complete transformation in the way you understand, manage and grow your net worth. There are over 1.3 million registered users of Personal Capital’s free tools.
Disclaimer: Personal Capital Advisors is an SEC registered investment advisor. Any reference to the advisory services refers to Personal Capital Advisors. SEC registration does not imply a certain level of skill or training.