Fiduciary Duty for All Brokers Coming Soon Says White | Cold Spring Advisory Group

Fiduciary Duty for All Brokers Coming Soon Says White

March 17, 2015

Mary Jo White, Chair of the Securities and Exchange Commission (SEC) announced today that the agency will "implement a uniform fiduciary duty for broker-dealers and investment advisors where the standard is to act in the best interest of the investor." At a recent speech at AARP, President Barak Obama spoke of protecting workers and retirees from receiving financial advice from broker-dealers who charge hidden fees and get kickbacks for selling unsuitable investments. He spoke specifically about protecting retirement accounts, adding that the Department of Labor will be re-proposing a rule requiring higher investment advice standards for brokers handing retirement accounts.

Ms. White's long-awaited statement was welcomed by proponents of strengthening standards for broker-dealers who, unlike investment advisors, are not required to put the best interests of their clients above their own. Her stance breaks the tie on the SEC's 5-person panel between the two Democrats who support uniform fiduciary duty, and the two Republicans who oppose it. In her remarks before a Securities Industry and Financial Markets Association in Phoenix, Ms. White did not give a timeline for when the rule would be proposed, but said her next steps were to meet with the other SEC commissioners to have in-depth conversations about how it would be outlined.