In the 10 days since the March 30 Washington D.C. Court of Appeals overturn of the SEC’s broker/dealer exemption from fiduciary responsibility for fee-based brokerage accounts, there has been a distinct point-counterpoint repartee, albeit indirectly, between the Financial Planning Association, which filed the lawsuit in 2004 protesting the broker/dealer exemption, and the Securities Industry and Financial Markets Association (SIFMA), which April 10 urged the SEC to ask the court for a “rehearing” of the March 30 ruling.

The latest salvo, on behalf of SIFMA’s broker/dealer membership, asserts that the ruling “has the potential to significantly impair an important element of consumer choice for American investors and we strongly urge the SEC to ask for a rehearing,” SIFMA’s President and CEO, Marc Lackritz, says in the announcement.

Though fee-based accounts were originally “introduced to better align consumer and broker interests,” according to the SIFMA statement, the broker/dealer rule allowed brokers to give “incidental” advice to customers without having to act as a fiduciary, using the suitability standard, which is a lower level of responsibility than the fiduciary standard that investment advisors must uphold. The FPA asserted in its July 2004 lawsuit that the SEC overstepped its authority in its interpretation of the Investment Advisor Act of 1940 in granting broker/dealers the exemption. Both SIFMA and the FPA agree that the ruling affects $300 billion in fee-based assets; with that much at stake chances are there will be much more discussion before this is settled.

The ruling of the U.S. Court of Appeals for the District of Columbia Circuit and the legal briefs filed in the case can be reviewed online here.

The announcement from SIFMA is available online here.