A discussion draft of proposed legislation sponsored by Rep. Ann Wagner, R-MO., would stamp out the Labor Department’s fiduciary rule and its attending prohibited transaction exemptions.
It would also amend the Securities Exchange Act of 1934 to include a best interest standard of care for brokers advising investors in the retail market.
An investment recommendation would satisfy the best interest standard if it reflected “reasonable diligence” on the part of the broker, the definition of which would be modeled on FINRA's existing definition, and reasonable “care, skill, and prudence,” based on a customer’s individual investment needs, according to language in the draft.
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
