September 20, 2024
The SEC Investor Advisory Committee recently hosted a panel discussion titled “Investment Advice: A History and Update on Who is Required to Serve in Your Best Interest.” The panel delved into the differences, similarities, and nuances of fiduciary standards under SEC rules, ERISA, and state law. In their opening remarks, Chair Gary Gensler and Commissioner Hester Peirce highlighted the fiduciary duty under the Advisers Act. Commissioner Peirce stressed the principles-based approach at the heart of the Advisers Act, which the IAA has called on the SEC to preserve in its rulemakings. Commissioner Caroline Crenshaw emphasized the need for the SEC to work productively with other regulators and legislators to limit the ability of parties to engage in regulatory arbitrage. Panelists discussed the implications of the federal court stays on the DOL’s Retirement Security Rule and related regulations, highlighting the increased uncertainty for both investors and financial professionals. The panel also discussed standards related to the sales of insurance products and the fact that there is not a single database with information about financial professionals across the securities and insurance industries.
The panel discussion provided valuable insights into the evolving landscape of fiduciary obligations and their significance for investors and financial professionals. The IAA has long advocated that all financial professionals who provide investment advice about securities to clients should be required to act under fiduciary principles.
The Committee also discussed litigation under the Securities Act and shareholder proposals.
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