Featured Product

    SEC Proposes Regulation Best Interest to Enhance Investor Protection

    May 09, 2018

    SEC proposed a package of rulemakings and interpretations designed to enhance the quality and transparency of investor relationships with investment advisers and broker-dealers, while preserving access to a variety of types of advice relationships and investment products. Comments are due by August 07, 2018.

    The proposed rules and interpretations would enhance investor protection by applying consistent principles to investment advisers and broker-dealers: provide clear disclosures, exercise due care, and address conflicts of interest. The specific obligations of investment advisers and broker-dealers would be, however, tailored to the differences in the types of advice relationships that they offer. Under the proposed Regulation Best Interest, a broker-dealer would be required to act in the best interest of a retail customer when making a recommendation of any securities transaction or investment strategy involving securities to a retail customer. Regulation Best Interest is designed to make it clear that a broker-dealer may not put its financial interests ahead of the interests of a retail customer in making recommendations. SEC also proposed:

    • An interpretation to reaffirm and, in some cases, clarify its views of the fiduciary duty that investment advisers owe to their clients. By highlighting principles relevant to the fiduciary duty, investment advisers and their clients would have more clarity about advisers’ legal obligations.
    • To help address investor confusion about the nature of their relationships with investment professionals through a new short-form disclosure document—a customer or client relationship summary. Form CRS would provide retail investors with simple, easy-to-understand information about the nature of their relationship with their investment professional and would supplement other more detailed disclosures. For advisers, additional information can be found in Form ADV.  For broker-dealers, disclosures of the material facts related to the scope and terms of the relationship would be required under Regulation Best Interest.
    • To restrict certain broker-dealers and their financial professionals from using the terms “adviser” or “advisor” as part of their name or title with retail investors.  Investment advisers and broker-dealers would also need to disclose their registration status with SEC in certain retail investor communications.

     

    Related Links

    Comment Due Date: August 07, 2018

    Keywords: Americas, US, Securities, Regulation Best Interest, Investor Protection, Retail Investors, Form CRS, Form ADV, SEC

    Related Articles
    News

    FSB Report Examines Implementation and Impact of G20 Financial Reforms

    FSB published fifth annual report on the implementation and effects of the G20 financial regulatory reforms.

    October 16, 2019 WebPage Regulatory News
    News

    EBA Launches Consultation on Comprehensive Pillar 3 Disclosures

    EBA proposed the new comprehensive implementing technical standard (ITS) for public disclosures by financial institutions.

    October 16, 2019 WebPage Regulatory News
    News

    EBA Consults on Revised Technical Standards on Supervisory Reporting

    EBA launched a consultation on the revised implementing technical standards, or ITS, on supervisory reporting.

    October 16, 2019 WebPage Regulatory News
    News

    APRA Proposes Measures to Strengthen Capital for Bank Depositors

    APRA proposed changes to APS 111, which is the prudential standard on measuring capital adequacy and establishes the criteria for regulatory capital requirements of authorized deposit-taking institutions.

    October 15, 2019 WebPage Regulatory News
    News

    FSB Report Examines Implementation of OTC Derivative Reforms

    FSB published annual progress report on implementation of the agreed G20 reforms for over-the-counter (OTC) derivatives markets.

    October 15, 2019 WebPage Regulatory News
    News

    FSB Publishes Update on Its Market Fragmentation Work

    FSB published an update on its work to address the issue of market fragmentation.

    October 14, 2019 WebPage Regulatory News
    News

    FCA Releases Feedback to Online Survey on New Data Collection Platform

    FCA published results of the survey requesting feedback for the new data collection platform that will replace GABRIEL.

    October 14, 2019 WebPage Regulatory News
    News

    HKMA Reduces Countercyclical Capital Buffer in Hong Kong to 2.0%

    HKMA announced that the countercyclical capital buffer (CCyB) for banks in Hong Kong has been reduced from 2.5% to 2.0%, with immediate effect, in accordance with the Banking (Capital) Rules.

    October 14, 2019 WebPage Regulatory News
    News

    EC Consults on Implementation of Final Basel III Reforms in EU

    EC launched a public consultation on the implementation of Basel III standards in EU.

    October 11, 2019 WebPage Regulatory News
    News

    MAS Amends Regulation on Clearing of Derivatives Contracts

    MAS amended regulation for the mandatory centralized clearing of certain derivative contracts.

    October 11, 2019 WebPage Regulatory News
    RESULTS 1 - 10 OF 3971