Broker-dealers are getting 4 more months to comply with a new regulation that will affect sales of variable life and variable annuity products through financial planners and discretionary brokerage accounts.[@@]
The U.S. Securities and Exchange Commission Monday extended the deadline for compliance with the rule to Jan. 31, 2006, from Oct. 24.
The SEC acted at the request of the American Council of Life Insurers, Washington; the Securities Industry Association, Washington; and the Financial Services Institute, Atlanta.
Under the new regulation, a broker-dealer that provides investment advice and delivers a financial plan to a customer as part of a financial plan or as part of financial planning services must follow the SEC rules governing investment advisors when working with that customer.
Financial services trade groups told the SEC that they needed a 6-month extension because complying with the new rule would be time-consuming and complex.
Several consumer groups opposed the request, noting that the SEC already had taken 5 years to address their concerns.