SEC fiduciary rule still a long way off

David Grim, director of the Securities and Exchange Commission’s Division of Investment Management, told House lawmakers Friday that while the IM division is busy developing a uniform fiduciary rule for advisors and brokers, he couldn’t say when such a plan would go before the Commission.

SEC Chairwoman Mary Jo White directed the IM Division as well as the Division of Trading and Markets in March to prepare a fiduciary recommendation.

But Grim told members of the House Financial Services Capital Markets Subcommittee that such a recommendation is still not ready.

Lawmakers on the subcommittee, including its chairman, Rep. Scott Garrett, R-N.J., told Grim that it was “ridiculous” that an SEC fiduciary rulemaking was taking so long.

When asked the “timetable” for when SEC staff would deliver a fiduciary plan to the Commission, Grim responded: “Our direction has been to develop a recommendation, and that’s what we’re doing,” adding that “it would be up to the Commission to vote on” a fiduciary rule.  

Said Grim to the lawmakers: “The issue is a complicated one that has been contemplated in prior years without a rule being proposed, and whether a rule is ultimately proposed and adopted depends on further analysis and action by the full Commission.”

As to when a recommendation would go to the commissioners and White: “It will go there as soon as it’s ready,” Grim said.

Rep. David Scott, D-Georgia, stated that the Department of Labor “is clearly out of bounds” by moving forward with its own fiduciary rulemaking under the Employee Retirement Income Security Act.