Fiduciary(redirected from Fiduciary Responsibility)
Also found in: Dictionary, Thesaurus, Medical, Legal, Encyclopedia.
2. Describing a duty or obligation to act in the best interest of another person or institution. For example, an elected government might state that it has a fiduciary duty to wisely use the taxes it collects.
3. An unsecured loan.
A fiduciary is an individual or organization legally responsible for managing assets on behalf of someone else, usually called the beneficiary. The assets must be managed in the best interests of the beneficiary, not for the personal gain of the fiduciary.
However, the concept of acting responsibly can be broadly interpreted, and may mean preserving principal to some fiduciaries and producing reasonable growth to others.
Executors, trustees, guardians, and agents with powers of attorney are examples of individuals with fiduciary responsibility. Firms known as registered investment advisers (RIAs) are also fiduciaries.
A person who enjoys a relationship of trust or confidence with respect to another such that the law will impose greater than normal responsibilities on the fiduciary for honesty, integrity,candor,and scrupulous good faith even if it means sacrificing the interests of the fiduciary. Typical fiduciaries include attorneys, real estate agents representing principals, trustees, and guardians. Because of the fiduciary relationship between an agent and principal, it is difficult to understand the concept of dual agency, in which the broker may represent both the buyer and seller.A seller's fiduciary must keep all the client's information confidential,not volunteer anything unless absolutely required by law, and attempt to gain the highest possible price for the property. A buyer's fiduciary must ferret out all secrets, volunteer all information regarding anything at all that might affect property values, recommend the most thorough home inspectors, and attempt to obtain the lowest possible price for a property. These positions are extremely difficult to reconcile in one person.