BROWSE BY TOPIC
Stories of Interest
- Louisiana Adviser Barred for Hiding Losses from Investors
- Connecticut HF Manager Illegally Diverted Investor Money - Now Owes Nearly $13Mn
- White House Cleaning House of Advisors Without Full Security Clearance
- Goldman Projects 30% Growth in Wealth Management Advisor Force
- Whistleblower Alleges Manipulation of CBOE Volatility Index
- FINRA Looking Into VIX (CBOE Volatility Index) Manipulation: WSJ
- Atlanta-Area Resident Charged with Misusing Investor Funds - SEC
- FINRA Announces 2018 West Region Networking Seminar
- Alberto Arevalo, Associate Director in Office of International Affairs, to Retire From SEC
- A Culprit for Financial Site Glitches: You and Your Apps
- Investor Protection, Capital Formation and Market Integrity Are Top Priorities in SEC Budget Request
- We Must Stop Out-Of-Control Trading or U.S. Capitalist System Will Break Down - Dick Bove
- SEC Launches Share Class Selection Disclosure Initiative to Encourage Self-Reporting and the Prompt Return of Funds to Investors
- BofA CEO Moynihan Got $23Mn Compensation for 2017 – a 15% Pay Raise
- Former Credit Suisse ‘Star’ Gets 5-Year Jail Term For "Clever Fraud"
- FINRA: Perspectives on Customer Arb Award Recovery
- FINRA: Amend Membership App Program to Incentivize Arbitration Award Payments
- Goldman's #2 Allegedly Swindled Out of $1.2Mn of Wine by Assistant
- FINRA Publishes Annual Budget Summary - No Fee Rate Increases for Member Firms
- CFTC Chairman Giancarlo Names Maggie Sklar Senior Counsel
We seek to provide information, insights and direction that may enable the Financial Community to effectively and efficiently operate in a regulatory risk-free environment by curating content from all over the web.
Stay Informed with the latest fanancialish news.
NEWSLETTERS & ALERTS
Rules & Regulations
FINRA on Fiduciary Duty
by Howard Haykin
The Chairman and CEO of FINRA gave a speech at an ALI-ABA Conference, in which he addressed the (seemingly never-ending) issue of establishing consistent fiduciary standards of care for investment advisers and brokers providing investment advice. [American Law Institute – American Bar Association]
I’d like to share the prepared text of that speech. [Note: Financialish emboldened certain text for emphasis.]
I testified before the House Financial Services Committee on Tuesday, and I told the Committee that FINRA whole-heartedly embraces the Administration's goal of harmonizing the regulation of broker-dealers and investment advisers. We believe that in order to accomplish that goal, two steps are necessary. The first is establishing a consistent fiduciary standard for investment advisers and broker-dealers providing investment advice. …
The Administration has proposed that the SEC write rules establishing consistent fiduciary standards of care for investment advisers and brokers providing investment advice. FINRA stands in agreement with numerous interested parties that the standard of care in both channels should be a fiduciary standard for the provision of advice.
We need to step away from the nonsense of diminishing present standards. We should start with a commitment that the standard is "business model neutral" and focus on the basic shift that each recommendation must be in the "best interest of the customer."
Harmonization of the standard of care is an important first step. However, given the number of recently revealed frauds perpetrated by investment advisers bound by the fiduciary standard, it is clear that the existence of the fiduciary standard of care alone is not a guarantee against misconduct. Compliance with that standard must be regularly and vigorously examined and enforced to ensure the protection of investors. …