NASAA Statement on SEC Investor Advisory Committee’s Support for Fiduciary Duty for Broker-Dealers

WASHINGTON (November 22, 2013) – The following is a statement from Andrea Seidt, president of the North American Securities Administrators Association (NASAA) and Ohio Securities Commissioner, regarding the recommendation approved today by the Securities and Exchange Commission’s Investor Advisory Committee (IAC) supporting the extension of a fiduciary duty to broker-dealers when they provide personalized investment advice to retail investors.

“State securities regulators strongly support the recommendations of the SEC’s Investor Advisory Committee to extend a fiduciary duty to broker-dealers when they provide personalized investment advice to retail investors, and to call for legislation to fund investment adviser examinations. NASAA encourages the SEC and Congress to take swift action on each of these important recommendations.

“Establishing a uniform fiduciary duty standard governing the conduct of broker-dealers and their agents is crucial for the protection of investors. Most investors cannot distinguish broker-dealers from investment advisers, nor do they understand the different legal standards applicable to either. As a result, many investors are confused and unable to make informed decisions about which type of financial professional to retain.

“A fiduciary standard for broker-dealers will guarantee that all financial professionals providing investment advice will act in the best interests of their clients, and in turn, enhance investor confidence in the financial services industry and securities markets. NASAA urges the SEC to pursue the recommendations of the IAC to require broker-dealers to adhere to the same fiduciary duty standard currently applied to investment advisers when those brokers offer personalized investment advice to retail investors and other customers.”

NASAA is the oldest international organization devoted to investor protection. Its membership consists of the securities administrators in the 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Canada and Mexico.

For More Information:
Bob Webster | Director of Communications



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