SEC's Regulation Best Interest Comes Under Attack

Principal David Buffa was quoted in the Think Advisor article, " SEC's Regulation Best Interest Comes Under Attack" on September 24, 2019. 

The article discusses the lawsuits filed against the Security and Exchange Commission’s Regulation Best Interest in early September by seven states along with the District of Colombia, siting failure to establish a “uniform fiduciary standard” and also meet basic needs for investor protections laid out by the Dodd-Frank Act. 

David Buffa, an attorney and member of the retail client group with Bressler, Amery & Ross, in New York, NY, commented to IA that “compared to the challenges that ultimately struck down the DOL’s fiduciary rule, I believe the SEC has a greater likelihood of success due to the broad discretion authorized by Dodd-Frank.” 

Buffa goes on to say that the Attorney Generals’ complaint “relies heavily on a provision of Dodd-Frank that authorized — but arguably did not require — the imposition of an investment adviser-level standard of care on broker-dealers, and due to the ambiguity in Dodd-Frank and SEC’s formal study and rulemaking process, it seems likely that the [court] will side with the regulator.”

Lastly, Buffa advises firms should not put their implementation efforts of Reg BI on hold, suggesting the complaints are the “first of many anticipated challenges to the SEC.”

To read the entire article on the Think Advisor website, please click here. To read the entire article in the digital form of the Investment Advisor magazine, click here.