It's been over a year since a Securities and Exchange Commission (SEC) study recommended uniform regulatory standards for investment advisers and broker-dealers. But a stalemate has developed as to how to implement the controversial Congressional mandate to harmonise the two regulatory approaches.
The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act) directed the SEC to evaluate regulatory standards of care for broker-dealers and investment advisers who provide personalised investment advice about securities to retail customers. Congress told the SEC to identify any legal or regulatory gaps, shortcomings, or overlaps in regulatory standards to protect retail customers.
Congress asked whether retail customers understand or are confused by the different standards of care that apply to broker-dealers and investment advisers, and the potential impact on retail customers that changes in the law would bring. After reviewing thousands of public comments, the SEC's staff issued its report in January...