With less than one month left to weigh in on Regulation Best Interest, investors and interest groups have inspired thousands of consumers to make their opinion known.
As up to 50 retail investors continue to pack the Securities and Exchange Commission’s roundtables across the country, AARP has rallied its following, flooding the comment page on the SEC’s website with consumer instances of bad experiences and confusion over the current practices of financial professionals.
The rulemaking package establishes a standard for broker-dealers, as well as a mandatory disclosure form (Form CRS) outlining client and advisor obligations. The proposal also creates guidelines for using the titles “advisor” or “adviser.”
Comments from AARP members appear to make up the majority of the comments on the website and can be identified by their call to action that reads:
I'm counting on you to make a stronger rule that closes the loophole. Americans who've worked hard to save for retirement deserve peace of mind about their financial security.
The statement is one of three talking points that AARP recommends in a consumer call to action.
AARP isn’t the only group engaging in the discussion, trade group SIFMA issued a statement in support of the proposal, saying “We were very encouraged to learn that the SEC, as the preeminent markets regulator, and under Chairman Clayton’s leadership, has engaged in this formal rulemaking. We continue to support the highest standards for our industry. SIFMA commends the SEC for proposing a new best interest standard under the Exchange Act that not only clearly and significantly raises the bar from the current suitability standard under FINRA Rules, but also incorporates the intended principles and goals of the former DOL fiduciary rule that it is replacing.”
Others groups, including the Consumer Federation of America, express concern over the vagueness of the proposal in its current state in their comments.
“One of the key problems with this proposal is that you can’t tell what it means,” said Barbara Roper, director of investor protection, CFA.
With one roundtable remaining, The SEC said it is happy with the responses it has received.
We’ve had a lot of informed, engaged investors commenting, said the agency. SEC staffers noted the respondents had “done their homework” bringing notes, suggestions and proposed language to the discussions.
The comment period is open until Aug. 7 for investors and professionals who still wish to weigh in on the proposal.
AdvisorNews Managing Editor Cassie Miller may be reached at firstname.lastname@example.org. Cassie has an extensive background in magazine writing, editing and design. Follow her on Twitter @INNCassieM.
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