Since early 2009, SIFMA has consistently advocated for the establishment of a new uniform fiduciary standard, and not application of the Advisers Act fiduciary standard to broker-dealers.
The new standard envisioned by SIFMA would: put retail customers' interests first; provide adequate flexibility to preserve and enhance customer choice of and access to financial products and services, and capital formation; provide for conflicts management; apply only to, and be tailored for, those services and activities that involve providing personalized investment advice about securities to retail customers; and not subject financial professionals to other fiduciary obligations (for example, the Advisers Act fiduciary standard, or other statutory standards).
SIFMA, through our member committees and otherwise, continues to engage policymakers and regulators with comprehensive empirical and legal analysis to help inform the process. We are hopeful that our substantive engagement and input will positively impact any rulemaking or other actions on this issue.
When considering the Department of Labor's (DOL) definition of fiduciary under the Employee Retirement Income Security Act (ERISA), the consequences for a broker being deemed a fiduciary include potential prohibitions on engaging in principal transactions, as well as difficulty receiving fees or commissions.
As written, SIFMA believes the proposed rule would ultimately harm investors by raising the cost of saving. SIFMA is working with the DOL through the regulatory process to avoid the harmful effects of this proposed rule.