{"id":4990,"date":"2018-04-20T20:54:51","date_gmt":"2018-04-20T20:54:51","guid":{"rendered":"https:\/\/www.investorlawyers.com\/?p=4990"},"modified":"2018-04-20T20:54:51","modified_gmt":"2018-04-20T20:54:51","slug":"sec-proposes-regulation-best-interests-that-would-prevent-brokers-from-merely-calling-themselves-investment-adviser","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/sec-proposes-regulation-best-interests-that-would-prevent-brokers-from-merely-calling-themselves-investment-adviser\/","title":{"rendered":"SEC Proposes \u201cRegulation Best Interests\u201d that Would Prevent Brokers from Merely Calling Themselves Investment Adviser"},"content":{"rendered":"<p>\t\t\t\tThe US Securities and Exchange Commission is proposing a rule that would keep registered representatives and brokers from also referring to themselves as investment advisors. In almost 1,000 pages of new proposals, the regulator articulated that it wants brokerage firms to make sure that the investing public knows that while brokers can sell investment products they are not trusted fiduciary advisors\u2014nor is it their role to continue to offer advice after a sale has been made. Under the proposed rule, brokers would no longer be allowed to call themselves a trusted \u201cadvisor\u201d or \u201cadviser.\u201d They can, however, take steps to become a registered investment adviser.<\/p>\n<p>Addressing the proposed package, SEC Chairman Jay Clayton said that \u201cinvestor confusion\u201d about what differentiates broker-dealers from investment advisers is what prompted these latest initiatives. While both can give retail investors advice regarding possible investments, the two have different kinds of relationships with them. Clayton also noted that retail investors can suffer harm if they don\u2019t know that certain conflicts of interest may be involved when working with either broker-dealers or investment advisers. Investors also may be giving more authority over their finances to a broker or investment adviser than they should.<\/p>\n<p>In a 4-1 vote this week, the SEC\u2019s \u201dRegulation Best Interests\u201d measures for brokers was moved forward. Under the new measures, brokers would be obligated to place clients\u2019 best interests before their own when it comes to recommending investment strategies or products. Brokers would have to set up and enforce written procedures and polices that would identify, expose, get rid of, or avoid conflicts of interest that might involve a financial incentive. While the existing broker standard requires that they recommend investment products that are suitable to each client, brokers are still allowed to endorse the products that gives them the greater financial payday.<\/p>\n<div class=\"read_more_link\"><a href=\"https:\/\/www.investorlawyers.com\/blog\/sec-proposes-regulation-best-interests-that-would-prevent-brokers-from-merely-calling-themselves-investment-adviser\/\"  title=\"Continue Reading SEC Proposes \u201cRegulation Best Interests\u201d that Would Prevent Brokers from Merely Calling Themselves Investment Adviser\" class=\"more-link\">Continue Reading \u203a<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"<p>The US Securities and Exchange Commission is proposing a rule that would keep registered representatives and brokers from also referring to themselves as investment advisors. In almost 1,000 pages of new proposals, the regulator articulated that it wants brokerage firms to make sure that the investing public knows that while brokers can sell investment products [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3773,3781,3738,3801,3760],"tags":[3034,3035,2961],"class_list":["post-4990","post","type-post","status-publish","format-standard","hentry","category-broker-fraud","category-investment-advisers","category-investor-fraud","category-sec","category-sec-enforcement","tag-brokers","tag-investment-advisors","tag-sec"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>SEC Proposes \u201cRegulation Best Interests\u201d that Would Prevent Brokers from Merely Calling Themselves Investment Adviser | SSEK Law Firm Blog<\/title>\n<meta name=\"description\" content=\"The US Securities and Exchange Commission is proposing a rule that would keep registered representatives and brokers from also referring to themselves as &#8212; April 20, 2018\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.investorlawyers.com\/blog\/sec-proposes-regulation-best-interests-that-would-prevent-brokers-from-merely-calling-themselves-investment-adviser\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"SEC Proposes \u201cRegulation Best Interests\u201d that Would Prevent Brokers from Merely Calling Themselves Investment Adviser | SSEK Law Firm Blog\" \/>\n<meta name=\"twitter:description\" content=\"The US Securities and Exchange Commission is proposing a rule that would keep registered representatives and brokers from also referring to themselves as &#8212; April 20, 2018\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Shepherd Smith Edwards &amp; Kantas, LLP\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"SEC Proposes \u201cRegulation Best Interests\u201d that Would Prevent Brokers from Merely Calling Themselves Investment Adviser | SSEK Law Firm Blog","description":"The US Securities and Exchange Commission is proposing a rule that would keep registered representatives and brokers from also referring to themselves as &#8212; April 20, 2018","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.investorlawyers.com\/blog\/sec-proposes-regulation-best-interests-that-would-prevent-brokers-from-merely-calling-themselves-investment-adviser\/","twitter_card":"summary_large_image","twitter_title":"SEC Proposes \u201cRegulation Best Interests\u201d that Would Prevent Brokers from Merely Calling Themselves Investment Adviser | SSEK Law Firm Blog","twitter_description":"The US Securities and Exchange Commission is proposing a rule that would keep registered representatives and brokers from also referring to themselves as &#8212; April 20, 2018","twitter_misc":{"Written by":"Shepherd Smith Edwards &amp; Kantas, LLP","Est. reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.investorlawyers.com\/blog\/sec-proposes-regulation-best-interests-that-would-prevent-brokers-from-merely-calling-themselves-investment-adviser\/#article","isPartOf":{"@id":"https:\/\/www.investorlawyers.com\/blog\/sec-proposes-regulation-best-interests-that-would-prevent-brokers-from-merely-calling-themselves-investment-adviser\/"},"author":{"name":"Shepherd Smith Edwards &amp; 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