Both RIAs and Broker/Dealers will have the same fiduciary standard when selling investments or making recommendations to clients. This issue dates back to 2010 when Dodd/Frank officially became a law. For those of you who aren’t tracking the status of Dodd/Frank, within Dodd/Frank there is a provision for the SEC to develop a single fiduciary standard for Broker/Dealers and RIAs. The SEC was supposed to report to Congress back in 2011 if a single fiduciary standard should be required, the SEC determined that it was needed. Congress then empowered the SEC to determine the cost and best way to implement a single standard, which is where it is stuck today.
The DOL has accomplished in about a year what has taken the SEC over five years and counting to work on. However, now that the DOL has done much of the heavy lifting for the SEC, expect to hear more from the SEC about a single standard. If the SEC ever adopts this requirement, it will have a broader implication than the DOL’s rule as it will affect all B/Ds and RIAs.
Reposted from Think Advisor READ THE ENTIRE ARTICLE HERE