What fiduciary duties do municipal advisors owe their clients?

• A. Maximizing the advisor's own profits.
• B. Loyalty, prudent advice, full disclosure of conflicts, and acting in the client's best interests.
• C. Providing only generic recommendations.
• D. Keeping all information confidential from the client.

Answer: (B)

Fiduciary duties require the municipal advisor to put the client’s interests first and to guide decisions with loyalty and care. This means providing prudent, well-founded advice that is tailored to the client’s objectives and risk tolerance, and backing it up with a thorough analysis. It also means disclosing any conflicts of interest fully so the client can judge whether the advice is influenced by factors beyond the client’s best interests, and always acting to benefit the client in selecting strategies and products.

That combination—loyalty, prudent advice, full disclosure of conflicts, and acting in the client’s best interests—captures the essence of the fiduciary standard. The other approaches conflict with this standard: pursuing the advisor’s own profits, offering only generic recommendations, or withholding information would fail to meet the duty to the client.