Thursday, 04 June 2020 17:19

Reg BI May Be Stopped Soon

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A whole squad of industry players are trying to stop the SEC’s new Reg BI in its tracks. From individual firms (like Michael Kitces’) to trade groups, many are filing lawsuits to stop the implementation of Reg BI. One of the critical arguments seems to be that the new Reg BI does not sufficiently protect investors under the rules of the Dodd-Frank Act. One principal at XY Planning Network says, simply, “Reg BI makes it more difficult for customers to differentiate between financial planners who are bound by fiduciary obligations and for broker-dealers who may consider their own financial interests”.

FINSUM: Both broker-dealers and RIAs are against this rule. For the former, it complicates life, and for the latter, it muddles some of their “fiduciary” thunder. Nonetheless, it seems the rule is likely to implemented on schedule.

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