According to a recent notice posted to its website on Wednesday, the SEC Commissioners are planning an Open Meeting next Wednesday (April 18th) to consider three new fiduciary-related proposals: the first would require a new “relationship summary” that all RIAs and broker-dealers would have to provide to consumers (which may be a step towards necessary title reform for financial advisors); the second would potentially establish a new standard of conduct for broker-dealers when making recommendations; and the last would provide additional “interpretations” of the (fiduciary) standard of conduct for investment advisers. The initiative is being framed by SEC Commissioner Jay Clayton as a way to improve advice for Main Street investors he has dubbed “Mr. and Mrs. 401(k)”, and the SEC’s push to issue its own fiduciary proposal – which it was actually first authorized to do back in 2010 but has stalled for nearly a decade – comes just as the Department of Labor’s own fiduciary rule hangs in limbo after the recent 5th Circuit Court of Appeals moved to vacate the rule, and in the face of rising momentum from individual states to take up their own fiduciary rules in the absence of a stringent Federal rule. Fiduciary opponents have harshly criticized the DoL’s fiduciary rule, and called on the SEC to issue an alternative that would better ‘harmonize’ regulation between broker-dealers and RIAs, while fiduciary advocates continue to raise concerns that the SEC will not be stringent enough in writing a new fiduciary rule for advice being delivered via broker-dealers.
extremeconsultingincblog 