In her recent testimony before Congress, Dalia Blass, the Director of the Division of Investment Management (the "Division") of the Securities and Exchange Commission ("SEC"), reported on the SEC's recent efforts to improve the retail investor experience. Director Blass highlighted the proposed Relationship Summary that is part of the proposed Regulation Best Interest ("Regulation BI"). The Relationship Summary would require broker-dealers and investment advisers to disclose in a succinct manner their relationships with retail investors. The Relationship Summary would highlight key differences between broker-dealers and investment advisers, including: (1) the principal types of services offered; (2) the legal standards of conduct that apply to each; (3) the fees the customer pays; and (4) certain conflicts of interest that may exist. Director Blass also noted a provision of Regulation Best Interest that would restrict the use of the term "adviser" and "advisor" by standalone broker-dealers. In addition, the Division proposed, as part of Regulation Best Interest, an interpretation of the investor advisers' fiduciary duty standards that would reaffirm or clarify the SEC's view on the fiduciary duty owed by investment advisers. The full text of the prepared testimony may be found here: https://goo.gl/Ust7TF.
Originally published in REVERSEinquiries: Volume 1, Issue
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