Some industry advocates are requesting the SEC write a clear provision explaining that the SEC's rules preempt competing state fiduciary rules. Others have said that differing state and federal security regulations have a long history of coexisting. (Photo: Diego M. Radzinschi/ALM)
As the Securities and Exchange Commission enters the final stretch in its effort to finalize rules that would elevate and clarify broker-dealers' and investment advisors' responsibilities to retail investors, questions are being raised as to how its regulations would coexist with state securities laws.
In January, the Securities Division within Nevada's Secretary of State office released a draft regulation of a fiduciary rule that includes provisions for broker-dealers that some say are more stringent than the SEC's proposed Regulation Best Interest.
Nevada's proposal includes a private right of action, giving investors the right to bring fiduciary breach claims in state court. The SEC's proposal does not include a new private right of action.
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