AdvisorOne.com covered from several angles the SEC's new Uniform Fiduciary Standard - which was released on Saturday, 1/23 - starting with the SEC's plans to proceed with Uniform Fiduciary Standard for broker-dealers and Investment Advisers, as told to Congress.  Advisor.One.com's also addressed:  (i) Politics and the Fiduciary Standard;  (ii) Fiduciary next steps;  (iii) SEC's 'Bold Blueprint'.    On Friday night, the SEC's related study was released.

The SEC recommends "the consideration of rulemakings that would apply expressly and uniformly to both broker-dealers and investment advisers, when providing personalized investment advice about securities to retail customers, a fiduciary standard no less stringent than currently applied to investment advisers" under the Investment Adviser Act of 1940.  Responsibility for drafting and ultimately implementing the new rules goes to 2 SEC Divisions:  Investment Management and Trading & Markets.

    Industry Reaction More Favorable.  Barbara Roper, Director of Investor Protection at the Consumer Federation of America (CFA), says the "SEC has taken the first, tentative step toward reversing that anti-investor policy by issuing a report calling for brokers to be subject to the same high standards all other advisers must meet when they recommend securities to investors."  For years, Roper continued, the SEC "has stood by and allowed broker-dealers to market themselves to investors as trusted advisers without requiring them to meet the most basic standard appropriate to that role—a fiduciary duty to act in their customers’ best interests."

    Don Trone (left), CEO of Strategic Ethos, says he believes the SEC “got it right,” and “captured the requisite subtleties associated with a fiduciary standard, while providing an appropriate and measured response to the concerns raised by broker-dealers.”  Trone also express concern that FINRA would be appointed as "the fiduciary guardian" for advisors. 

    Executive Director David Tittsworth said the Investment Adviser Association (IAA) has 2 major concerns:  (i) the IAA will work to oppose efforts to weaken or water down the well-established fiduciary duty under the Advisers Act.  (ii) the IAA thinks it would be a mistake to establish different standards of care for different types of clients.

    General Counsel Ira Hammerman said SIFMA supports a uniform fiduciary standard of care and believes that the SEC report articulates a "workable comprehensive approach for personalized investment advice for retail customers."  However, he said, SIFMA remains concerned about a uniform fiduciary standard's "possible effects on broker-dealers' ability to serve customers as this approach is developed" and that SIFMA will "continue to work with the SEC to ensure that the broker-dealer role is not hindered."  The SEC report also states that Section 913 of Dodd-Frank, “explicitly provides that the receipt of commission-based compensation, or other standard compensation, for the sale of securities does not, in and of itself, violate the uniform fiduciary standard of conduct applied to a broker-dealer. Section 913 also provides that the uniform fiduciary standard does not necessarily require broker-dealers to have a continuing duty of care or loyalty to a retail customer after providing personalized investment advice.”

For further details, go to:   SEC Tells Congress ... Uniform Fiduciary Standard for Brokers, Advisors.