Robo Advisers: An Argument for More Information Solicitation and Disclosure to Satisfy Fiduciary Duties

34 Pages Posted: 11 Jan 2020

See all articles by Greg Callaghan

Greg Callaghan

University of Colorado School of Law

Date Written: December 18, 2019

Abstract

It is proposed that robo advisers should gather more investor data to act in the best interest of investors by implementing enhanced, digital communications systems in their platforms that will better enable robo advisers to solicit/disclose information from/to an investor while also providing investors the ability to input and request information from robo advisers. The purpose of embedding digital communications systems will not only increase interactions between robo advisers and investors, it will allow for robo advisers to take advantage of their algorithm and platform technology to gather sufficient, current data from investors that is necessary to offer investment advice in investors’ best interests.

First, this Paper will introduce robo advisers and industry information. Second, the relevant legal oversight of the robo adviser industry related to legislation, fiduciary duties, and regulatory guidance will be discussed. Finally, the argument that robo advisers’ best interest fiduciary duties should focus on increasing information gathering through communications between robo advisers and investors will be put forth and explained.

Keywords: Robo Adviser, Robos, Fintech, Investment Adviser, Robo Advisor

Suggested Citation

Callaghan, Greg, Robo Advisers: An Argument for More Information Solicitation and Disclosure to Satisfy Fiduciary Duties (December 18, 2019). Available at SSRN: https://ssrn.com/abstract=3506507 or http://dx.doi.org/10.2139/ssrn.3506507

Greg Callaghan (Contact Author)

University of Colorado School of Law ( email )

Boulder, CO
United States

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