The SEC is slated to propose its eagerly-awaited version of a fiduciary duty rule - i.e., standard of conduct requirements for investment advisers and registered B-Ds - at an open meeting on Wednesday.
The meeting notice encompasses consideration of these three interrelated proposals:
- New and amended rules and forms to require registered investment advisers and registered broker-dealers to provide a brief relationship summary to retail investors
- Rule to establish a standard of conduct for broker-dealers and natural persons who are associated persons of a broker-dealer when making a recommendation of any securities transaction or investment strategy involving securities to a retail customer
- Commission interpretation of the standard of conduct for investment advisers
As previously reported, in March, a Fifth Circuit Court of Appeals panel vacated the DOL's controversial fiduciary duty rule (including associated exemptions) on the basis of the rule's unreasonableness under Chevron, its being arbitrary and capricious under the APA, and the agency's exceeding its statutory authority under ERISA. The DOL's rule has been hotly debated and contested since (if not well before) its issuance in April 2016. The SEC has on numerous occasions (see e.g., here and here) indicated that tackling this topic is among its top priorities.
See also these articles from the WSJ: "SEC to Propose Stricter Broker Standards Next Week," ThinkAdvisor: "SEC to Take Up Fiduciary Proposal on April 18," and InvestmentNews: "Sneak peek at new SEC advice standard sparks hope, concern"; our prior report: "SEC Focused on Fiduciary Rulemaking"; and numerous additional resources on our Financial/Investment Advisors topical page.