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SEC Posts Final Broker-Dealer Definition Rule

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NU Online News Service, April 19, 2005, 5:53 p.m. EDT

The U.S. Securities and Exchange Commission has published the final version of a controversial regulation dealing with the role of broker-dealers.[@@]

The regulation, which appears today in the Federal Register, holds that broker-dealers can set up fee-based or asset-based compensation arrangements and engage in many activities that involve efforts to provide some financial advice without having to meet all of the many requirements that apply to investment advisors.

But the preamble to the final regulation also talks about SEC Chairman William Donaldson’s decision to request a 90-day staff study that will investigate the possibility of eliminating distinctions between broker-dealers and investment advisors at the retail level.

The regulation and the preamble are on the Web at


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