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DOL Fiduciary News: September 7, 2017

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Battle lines form as SEC considers new fiduciary rule 

InvestmentNews; Sep 6, 2017 @ 2:10 pm

The Securities and Exchange Commission should not blend investment-advice standards that apply to investment advisers and brokers, as the agency considers a new advice rule, the Investment Adviser Association said in a recent comment letter.

The letter is one of dozens the SEC has received) since putting out a June 1 request for comment on fiduciary duty. There is no firm deadline on responses, but the feedback so far indicates that the debate over advice is once again breaking down between those who say that brokers should meet the same kind of best-interest standard that governs investment advisers and those who say that tweaking the suitability standard that applies to brokers would do the trick.

The IAA said the SEC should raise the advice bar for brokers without trying to split the difference between advisers and brokers. "Pursuing a single 'harmonized' standard of conduct would not effectively serve investors because it would result in a weakening or 'watering down' of the existing robust fiduciary standard applicable to investment advisers," Gail Bernstein, IAA general counsel, wrote in an Aug. 31 comment letter..

Dalia Blass could tackle fiduciary standard as first order of business at SEC 

InvestmentNews; Sep 6, 2017 @ 12:01 am

Dalia Blass' first order of business as head of the Securities and Exchange Commission's Division of Investment Management could be to shape the agency's position on a fiduciary standard.

"I'm going to be surprised if that's not the first order of business — getting the SEC back in charge of the fiduciary rule," said Norm Champ, a partner at Kirkland & Ellis and a former investment division director. "She's very qualified to get that done and would have a lot of influence on how it's done," said Mr. Champ, who is the author of "Going Public" (McGraw-Hill, 2017), a book about his SEC tenure.

Ms. Blass, 45, was appointed to the post last week. She returns to the agency, where she worked for about a decade in the division before leaving in 2016 for the securities law firm Ropes & Gray.

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