Self-Dealing

DEFINITION of 'Self-Dealing'

A situation in which a fiduciary acts in his own best interest in a transaction rather than in the best interest of his clients. A fiduciary is legally obligated to act in the best interest of his clients. If he breaches this obligation, the wronged party can sue the fiduciary for monetary damages.

BREAKING DOWN 'Self-Dealing'

Individuals who may be in the position of fiduciary include trustees, attorneys, corporate officers, board members and financial advisors. An example of self-dealing would be if a broker knowingly advised his clients to purchase products which would cause them harm, but would pay the broker a hefty commission.

RELATED TERMS
  1. Fiduciary Fraud

    Illegal practices committed by financial institutions and financial ...
  2. Fiduciary

    A fiduciary is a person who acts on behalf of another person, ...
  3. Fiduciary Negligence

    A professional malpractice in which a person fails to honor his ...
  4. Named Fiduciary

    The fiduciary that holds responsibility over a given financial ...
  5. Fiduciary Rule

    Fiduciary rule is regulation that requires retirement advisors ...
  6. Fiduciary Certification

    The certification process to ensure that fiduciaries uphold the ...
Related Articles
  1. Managing Wealth

    What is a Fiduciary?

    A fiduciary is a person who acts on behalf of another person (or people) to manage assets.
  2. Investing

    Why Realtors Have Fiduciary Responsibilities

    Find out why real estate agents are considered to have a legal fiduciary responsibility to uphold the best interests of their clients.
  3. Financial Advisor

    Meeting Your Fiduciary Responsibility

    Being a fiduciary comes with a certain level of responsibility. These four steps will reduce your liability when managing other people's money.
  4. Investing

    Why the Fiduciary Rule is Good for All Investors

    The new fiduciary standard should help lower what middle- and lower-income investors pay, on average, to brokers for retirement planning advice.
  5. Financial Advisor

    Fiduciary Rule Impact: How it's Already Being Felt

    The fiduciary rule will be announced today but it's impact is already being felt. Here's how.
  6. Financial Advisor

    How SEC and DOL Fiduciary Standards Could Differ

    SEC fiduciary standards could differ from what the DOL has proposed, causing more confusion about the impact of the rule.
  7. Financial Advisor

    Fiduciary Designations For Financial Advisors

    Attaining the AIF or AIFA could help both you and your clients enjoy a comfortable retirement.
  8. Financial Advisor

    How the New Fiduciary Rule Will Impact Investors

    The DOL's new fiduciary rule is now in effect. Here are a few areas where individual investors, including clients and prospects, might notice some change.
  9. Retirement

    An Introduction To Fiduciary Advisors

    Offering personalized solutions in a world of cookie-cutter advice may be your ticket to career perfection.
  10. Retirement

    Retirees: Don’t Lose Your Fiduciary Rule Protection

    Retired? The Department of Labor’s proposed fiduciary rule may affect the management of your tax-advantaged retirement accounts. Here’s the lowdown.
RELATED FAQS
  1. What is required to establish a fiduciary relationship between a financial advisor ...

  2. Why is fiduciary duty so important?

    Find out why fiduciary duty is so important, including what this legal obligation entails and an example of how it can affect ... Read Answer >>
  3. Why do financial advisors have a fiduciary responsibility?

    Find out why financial advisors have a fiduciary duty to their clients, including what fiduciary duty entails and an example ... Read Answer >>
  4. What is fiduciary liability insurance, and what are its benefits?

    Understand what fiduciary liability insurance is, what companies or individuals can benefit from having it, and when it is ... Read Answer >>
  5. What are some examples of fiduciary duty?

    Understand what it means to be a fiduciary, under what circumstances fiduciary duties arise and some common examples of fiduciary ... Read Answer >>
  6. What is a fiduciary deed and when is it useful?

    Understand what a fiduciary deed is and under what circumstances it should be used. Learn about the principles behind its ... Read Answer >>
Hot Definitions
  1. GBP

    The abbreviation for the British pound sterling, the official currency of the United Kingdom, the British Overseas Territories ...
  2. Diversification

    A risk management technique that mixes a wide variety of investments within a portfolio. The rationale behind this technique ...
  3. European Union - EU

    A group of European countries that participates in the world economy as one economic unit and operates under one official ...
  4. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  5. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
  6. Brexit

    The Brexit, an abbreviation of "British exit" that mirrors the term Grexit, refers to the possibility of Britain's withdrawal ...
Trading Center