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SEC will develop fiduciary duty rule for brokers, White says

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(Bloomberg) — U.S. Securities and Exchange Commission Chair Mary Jo White said the agency will develop stricter rules for brokers, wading into a battle between Wall Street and the White House, which says biased financial advice is costing investors billions of dollars.

White’s remarks follow a Labor Department move to make brokers put the interests of retirement savers ahead of their own, a so-called fiduciary duty. The SEC, which oversees the brokerage industry as a whole, has studied the issue for years without taking any regulatory action.

The SEC should “implement a uniform fiduciary duty for broker-dealers and investment advisers where the standard is to act in the best interest of the investor,” White said Tuesday at a securities industry conference in Phoenix.

The financial industry has been watching closely for White’s position, which would break a standoff between the two Democrat and two Republican commissioners. White said she will begin talking with the other commissioners about the outlines of new rules.

“Getting the balance right is absolutely essential,” she said.