Tim Ryan, CEO of the Securities Industry and Financial Markets Association (SIFMA), spoke on Oct. 26 at the City Club of Washington on the implementation of Dodd-Frank.
Ryan laid out the issues at the top of SIFMA’s list regarding Dodd-Frank, the “SIFMA Seven.” They are: systemic risk, resolution authority, derivatives, securitization and the credit rating agencies, capital/liquidity, Volker (Proprietary Trade and Private Equity), and the IA/BD fiduciary standard issue.
As to the fiduciary standard issue, I queried Ryan after his speech about relying on disclosures to address conflicts when a mountain of evidence suggests disclosures often don’t work. In his candid reply to my questions, Ryan was very conversant on the topic.
Ryan stated matter-of-factly that the “uniform” fiduciary standard that the Securities and Exchange Commission (SEC) is working on will not be the fiduciary standard under the Advisers Act of 1940, because, he opined, we have to have a standard that will “work for everyone.” He then spoke about recently attending a SIFMA meeting of experts on disclosures who apparently were tasked with coming up with disclosures that clients can understand.
I emailed a SIFMA spokesperson for more information on this meeting; the prompt reply stated: “We don’t discuss private meetings.”