Politics and Process: SEC and the Fiduciary Study—Slideshow

AdvisorOne Wealth Editor in Chief Kathleen McBride examines the SEC's fiduciary study

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  • Risk-Based Oversight of Investment Advisors Even if the SEC had a larger budget and more resources, it is doubtful that the Commission would have the resources to regularly examine all RIAs. Therefore, the SEC is likely to continue relying on risk-based oversight to fulfill its mission of protecting investors.
  • Do’s and Don’ts of Advisory Contracts In preparation for a compliance exam, securities regulators typically will ask to see copies of an RIAs advisory agreements. An RIA must be able to produce requested contracts and the contracts must comply with applicable SEC or state rules.

AdvisorOne Wealth Editor in Chief Kathleen McBride has closely followed the Securities and Exchange Commission's study on whether to extend a fiduciary standard to all advice givers in her series, SEC and the Fiduciary Study.

Extending the standard beyond RIAs could signal a seismic shift in how advice is provided to investors, changing the way brokers and investment advisors conduct their businesses, and what protections the SEC is willing to institute for investors. Not since the Securities Exchange Act of 1934 and the Investment Advisers Act of 1940 has there been more potential for re-drawing the rules that govern conduct of brokers and investment advisors toward customers and clients.

Click through for more on the long road to resolution over whether and how the fiduciary standard should be applied.

SEC and the Fiduciary Study: The Process

In late January, the SEC delivered to Congress its six-month report, “Study Regarding Obligations of Brokers, Dealers, and Investment Advisers,” mandated in the Dodd-Frank Act. The report is the next step in the long debate over whether the fiduciary standard should apply to all who provide investment and financial advice to individual investors.

Read Part 1 of the SEC and the Fiduciary Study series.

SEC and the Fiduciary Study: Politics and the Fiduciary Standard

On Jan. 22, the staff of the SEC delivered to Congress a report called the “Study on Investment Advisors and Broker-Dealers” that was mandated under Section 913 of 2010’s Dodd-Frank financial services reform law. The report is the most significant, if not final, step in the long debate over whether the fiduciary standard should apply to all who provide investment and financial advice to individual investors.

Read Part 2 of the SEC and the Fiduciary Study series.

 Where Do We Go From Here?SEC and the Fiduciary Study: Where Do We Go From Here?

The SEC’s Study on Investment Advisers and Broker-Dealers has by now been digested by the legions of followers of both sides of the debate on extending the fiduciary standard to brokers who provide advice. It seems that now the debate is not about whether to extend, but rather how to extend fiduciary duty to all who advise individuals.

Read Part 3 of the SEC and the Fiduciary Study series.

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